Trade liberalization and labor market in Brazil: impacts on employment and wages in tradeables and nontradeables sectors
The aim of this paper is to analyze the impacts of openness on employment and wages, taking into consideration two crucial aspects. The first, related to labor demand, refers to an increase in the relative employment of less-skilled workers. With Brazil being a developing country with abundant less-skilled labor, it can be expected – based on H-O-S – that income redistribution in favor of unskilled labor may occur after the trade liberalization. The second aspect is the impact on tradeables and non-tradeables. The H-O-S model implicitly admits tradeables goods only. However, the effect on the labor market is also felt on the non-tradeables sector. This aspect has been neglected in the analyses concerning this subject in the Brazilian economy. The conclusion raises the point that it is difficult to define any prevalence of labor demand shifts in the tradeables or nontradeables sectors. However, when the analysis is carried out after breaking down data based on levels of education, it is possible to conclude that the demand for unskilled workers increased after trade liberalization in Brazil. Nevertheless, demand shifts among sectors suggest that H-O-S framework does not explain the impacts of trade liberalization in Brazil, since the demand for skilled workers increased among the same sectors. This data, however, needs to be looked at with caution since the stabilization in Brazil (1994) changed income distribution by means and through the effects of an inflation tax and forced saving.
|Date of creation:||Aug 2002|
|Date of revision:|
|Contact details of provider:|| Postal: |
Fax: +55 31 3201-3657
Web page: http://www.cedeplar.ufmg.br
More information through EDIRC
|Order Information:|| Postal: Cedeplar-FACE-UFMG Av. Antonio Carlos, 6627 Belo Horizonte, MG 31270-901 Brazil|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gene M. Grossman & Elhanan Helpman, 1989.
"Comparative Advantage and Long-Run Growth,"
NBER Working Papers
2809, National Bureau of Economic Research, Inc.
- Krueger, Anne O, 1997.
"Trade Policy and Economic Development: How We Learn,"
American Economic Review,
American Economic Association, vol. 87(1), pages 1-22, March.
- Anne O. Krueger, 1997. "Trade Policy and Economic Development: How We Learn," NBER Working Papers 5896, National Bureau of Economic Research, Inc.
- T. N. Srinivasan & Jagdish Bhagwati, 1999. "Outward-Orientation and Development: Are Revisionists Right," Working Papers 806, Economic Growth Center, Yale University.
- Eli Berman & John Bound & Zvi Griliches, 1993. "Changes in the Demand for Skilled Labor within U.S. Manufacturing Industries: Evidence from the Annual Survey of Manufacturing," NBER Working Papers 4255, National Bureau of Economic Research, Inc.
- Ana Flávia Machado & Maurício Mesquita Moreira, 2001. "Os impactos da abertura comercial sobre a remuneração relativa do trabalho no Brasil," Textos para Discussão Cedeplar-UFMG td158, Cedeplar, Universidade Federal de Minas Gerais.
- Hanson, G.H. & Harrison, A., 1995.
"Trade, Technology and Wage Inequality,"
95-20, Columbia - Graduate School of Business.
- Ann Harrison & Gordon Hanson, 1999.
"Who Gains from Trade Reform? Some Remaining Puzzles,"
NBER Working Papers
6915, National Bureau of Economic Research, Inc.
- Harrison, Ann & Hanson, Gordon, 1999. "Who gains from trade reform? Some remaining puzzles," Journal of Development Economics, Elsevier, vol. 59(1), pages 125-154, June.
- Edwards, Sebastian, 1992.
"Trade orientation, distortions and growth in developing countries,"
Journal of Development Economics,
Elsevier, vol. 39(1), pages 31-57, July.
- Sebastian Edwards, 1991. "Trade Orientation, Distortions and Growth in Developing Countries," NBER Working Papers 3716, National Bureau of Economic Research, Inc.
- Dani Rodrik & Andres Velasco, 1999. "Short-Term Capital Flows," NBER Working Papers 7364, National Bureau of Economic Research, Inc.
- Sebastian Edwards, 1995.
"Trade Policy, Exchange Rates, and Growth,"
in: Reform, Recovery, and Growth: Latin America and the Middle East, pages 13-52
National Bureau of Economic Research, Inc.
- Ben-David, Dan & Kimhi, Ayal, 2000.
"Trade And The Rate Of Income Convergence,"
CEPR Discussion Papers
2390, C.E.P.R. Discussion Papers.
- Dan Ben-David & Ayal Kimhi, 2001. "Trade and the rate of income convergence," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 13(4), pages 419-441.
- Harrison, Ann, 1991.
"Openness and growth : a time series, cross-country analysis for developing countries,"
Policy Research Working Paper Series
809, The World Bank.
- Harrison, Ann, 1996. "Openness and growth: A time-series, cross-country analysis for developing countries," Journal of Development Economics, Elsevier, vol. 48(2), pages 419-447, March.
- Ann Harrison, 1995. "Openness and Growth: A Time-Series, Cross-Country Analysis for Developing Countries," NBER Working Papers 5221, National Bureau of Economic Research, Inc.
- Gene M. Grossman, 1984.
"Imports as a Cause of Injury: The Case of the U.S. Steel Industry,"
NBER Working Papers
1494, National Bureau of Economic Research, Inc.
- Grossman, Gene M., 1986. "Imports as a cause of injury: The case of the U.S. steel industry," Journal of International Economics, Elsevier, vol. 20(3-4), pages 201-223, May.
- Jeffrey Sachs & Andrew Warner, 1995.
"Economic Reform and the Progress of Global Integration,"
Harvard Institute of Economic Research Working Papers
1733, Harvard - Institute of Economic Research.
- Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 1-118.
- Wood, Adrian, 1991. "How Much Does Trade with the South Affect Workers in the North?," World Bank Research Observer, World Bank Group, vol. 6(1), pages 19-36, January.
- Findlay, Ronald, 1984. "Growth and development in trade models," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 4, pages 185-236 Elsevier.
- Dani Rodrik, 1992. "The Rush to Free Trade in the Developing World: Why So Late? Why Now? Will it Last?," NBER Working Papers 3947, National Bureau of Economic Research, Inc.
- Srinivasan, T.N. & Bhagwati, J., 1999. "Outward-Orientation and Development: Are Revisionist Right?," Papers 806, Yale - Economic Growth Center.
- Revenga, Ana, 1997. "Employment and Wage Effects of Trade Liberalization: The Case of Mexican Manufacturing," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages S20-43, July.
- Rodrik, Rani, 1995. "Trade and industrial policy reform," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 45, pages 2925-2982 Elsevier.
When requesting a correction, please mention this item's handle: RePEc:cdp:texdis:td174. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gustavo Britto)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.