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Job Creation and Trade in Manufactures: Industry Level Analysis Across Countries

Listed author(s):
  • Admasu Shiferaw

    ()

    (Department of Economics, The College of William and Mary)

  • Degol Hailu

    (United Nations Development Program (UNDP), New York)

This paper examines industry level responses of manufacturing employment in the context of globalization using a large sample of developed, developing and transition economies. We find that developing countries need atypically high rates of value added growth (about 10%) to increase manufacturing employment appreciably (about 4%). The employment benefits of export-orientation are also modest even in "comparative advantage" industries of developing countries. However, diversifying the export basket contributes significantly to employment growth, particularly in the medium- and high-technology industries. Import-competition does not undermine employment growth in low-technology industries of developing countries while it displaces jobs in the same industries in OECD and transition economies. For developing countries, import-induced job losses are higher in the more capital-intensive medium-technology industries. Jobs in high-technology industries are less sensitive to imports with positive relationships observed in the OECD. Investment also complements job creation in lowtechnology industries of developing countries that have yet to industrialize.

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File URL: http://economics.wm.edu/wp/cwm_wp167.pdf
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Paper provided by Department of Economics, College of William and Mary in its series Working Papers with number 167.

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Length: 46 pages
Date of creation: 02 Sep 2015
Handle: RePEc:cwm:wpaper:167
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