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Sewing Success? Employment, Wages, and Poverty following the End of the Multi-Fibre Arrangement

Author

Listed:
  • Gladys Lopez-Acevedo
  • Raymond Robertson

Abstract

The global textile and apparel sector is critically important as an early phase in industrialization for many developing countries and as a provider of employment opportunities to thousands of low-income workers, many of them women. The goal of this book is to explore how the lifting of the Multi-fibre Arrangement/ Agreement on Textiles and Clothing (MFA/ATC) quotas has affected nine countries Bangladesh, Cambodia, Honduras, India, Mexico, Morocco, Pakistan, Sri Lanka, and Vietnam with the broader aim of better understanding the links between globalization and poverty in the developing world. Analyzing how employment, wage premiums, and the structure of the apparel industry have changed after the MFA/ATC can generate important lessons for policy makers for economic development and poverty reduction. This book uses in-depth country case studies as the broad methodological approach. In-depth country studies are important because countries are idiosyncratic: differences in regulatory context, history, location, trade relationships, and policies shape both the apparel sector and how the apparel sector changed after the end of the MFA. In-depth country studies place broader empirical work in context and strengthen the conclusions. The countries in this book were chosen because they represent the diversity of global apparel production, including differences across regions, income levels, trade relationships, and policies. The countries occupy different places in the global value chain that now characterizes apparel production. Not surprisingly, the countries studied in this book represent the diversity of post-MFA experiences. This book highlights four key findings: The first is that employment and export patterns after the MFA/ATC did not necessarily match predictions. This book shows that only about a third of the variation in cross-country changes in exports is explained by wage differences. While wage differences explain some of the production shifts, domestic policies targeting the apparel sector, ownership type, and functional upgrading of the industry also played an important role. Second, changes in exports are usually, but not always, good indicators of what happens to wages and employment. While rising apparel exports correlated with rising wages and employment in the large Asian countries, rising exports coincided with falling employment in Sri Lanka. Third, this book identifies the specific ways that changes in the global apparel market affected worker earnings, thus helping to explain impacts on poverty. Fourth, in terms of policies, the countries that had larger increases in apparel exports were those that promoted apparel sector upgrading; those that did not promote upgrading had smaller increases or even falling exports.

Suggested Citation

  • Gladys Lopez-Acevedo & Raymond Robertson, 2012. "Sewing Success? Employment, Wages, and Poverty following the End of the Multi-Fibre Arrangement," World Bank Publications, The World Bank, number 13137, April.
  • Handle: RePEc:wbk:wbpubs:13137
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    File URL: https://openknowledge.worldbank.org/bitstream/handle/10986/13137/675240PUB0EPI0067882B09780821387788.pdf?sequence=1
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    References listed on IDEAS

    as
    1. Khalid Nadvi & John T. Thoburn & Bui Tat Thang & Nguyen Thi Thanh Ha & Nguyen Thi Hoa & Dao Hong Le & Enrique Blanco De Armas, 2004. "Vietnam in the global garment and textile value chain: impacts on firms and workers," Journal of International Development, John Wiley & Sons, Ltd., vol. 16(1), pages 111-123.
    2. repec:taf:rjapxx:v:14:y:2009:i:2:p:162-171 is not listed on IDEAS
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    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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    Cited by:

    1. Valeria SMEETS & Sharon TRAIBERMAN & Frederic WARZYNSKI, 2014. "Offshoring and the Shortening of the Quality Ladder: Evidence from Danish Apparel," Working Papers DP-2014-12, Economic Research Institute for ASEAN and East Asia (ERIA).
    2. Kaminski, Bartlomiej & Ng, Francis, 2013. "Increase in protectionism and its impact on Sri Lanka's performance in global markets," Policy Research Working Paper Series 6512, The World Bank.
    3. Staritz, Cornelia & Morris, Mike, 2012. "Local embeddedness, upgrading, and skill development: Global value chains and foreign direct investment in Lesotho's apparel industry," Working Papers 32, Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) / Austrian Foundation for Development Research.
    4. Jolta Kacani & Lucas Wunnik, 2017. "Using Upgrading Strategy and Analytics to Provide Agility to Clothing Manufacturing Subsidiaries: With a Case Study," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 18(1), pages 21-31, March.
    5. Makino, Momoe, 2012. "What motivates female operators to enter the garment industry in Pakistan in the post-MFA period?," IDE Discussion Papers 374, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    6. Giorgos Galanis & Ashok Kumar, 2018. "A dynamic spatial model of global governance structures," Working Papers PKWP1804, Post Keynesian Economics Study Group (PKSG).
    7. Lopez-Acevedo, Gladys & Robertson, Raymond, 2012. "The Promise and Peril of Post-MFA Apparel Production," World Bank - Economic Premise, The World Bank, issue 84, pages 1-4, May.
    8. repec:bla:worlde:v:40:y:2017:i:7:p:1473-1493 is not listed on IDEAS
    9. Fukunishi, Takahiro & Yamagata, Tatsufumi, 2013. "Slow and steady wins the race : how the garment industry leads industrialization in low-income countries," IDE Discussion Papers 412, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    10. Morris, Mike & Staritz, Cornelia, 2014. "Industrialization Trajectories in Madagascar’s Export Apparel Industry: Ownership, Embeddedness, Markets, and Upgrading," World Development, Elsevier, vol. 56(C), pages 243-257.
    11. repec:ilo:ilowps:483489 is not listed on IDEAS
    12. repec:gam:jsusta:v:9:y:2017:i:8:p:1344-:d:106573 is not listed on IDEAS
    13. Fukunishi, Takahiro, 2013. "Political crisis and suspension of duty-free access in Madagascar : assessment of impacts on the garment industry," IDE Discussion Papers 422, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    14. Cornelia Staritz & Mike Morris, 2013. "Local embeddedness and economic and social upgrading in Madagascar’s export apparel industry," Brooks World Poverty Institute Working Paper Series ctg-2013-21, BWPI, The University of Manchester.
    15. Rossi, Arianna, 2013. "Does Economic Upgrading Lead to Social Upgrading in Global Production Networks? Evidence from Morocco," World Development, Elsevier, vol. 46(C), pages 223-233.
    16. Thomas Bernhardt, 2013. "Developing countries in the global apparel value chain: a tale of upgrading and downgrading experiences," Brooks World Poverty Institute Working Paper Series ctg-2013-22, BWPI, The University of Manchester.

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