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Trade Liberalization and Intersectoral Labor Movements

  • Wacziarg, Romain

    (Stanford U)

  • Seddon, Jessica

This paper examines the impact of trade liberalization episodes on movements of labor across sectors. The aim is to evaluate the empirical support for two classes of models: those where the effects of trade are mediated by structural change, and those where the effects of trade do not rely on such sectoral shifts. Our results provide evidence consistent with the latter. Surprisingly, we find small or negative effects of liberalization on intersectoral labor shuffling at the economy-wide 1-digit level of disaggregation. Increased sectoral change at the 3 and4 digit levels within manufacturing, as a result of trade liberalization,. is mainly attributable to increases in manufacturing labor supply that is spread unevenly across sectors, rather than to movements of jobs across manufacturing subsectors.

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File URL: http://gsbapps.stanford.edu/researchpapers/library/rp1652.pdf
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Paper provided by Stanford University, Graduate School of Business in its series Research Papers with number 1652.

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Date of creation: Sep 2000
Date of revision:
Handle: RePEc:ecl:stabus:1652
Contact details of provider: Postal: Stanford University, Stanford, CA 94305-5015
Phone: (650) 723-2146
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  1. Wacziarg, Romain & Seddon, Jessica, 2000. "Trade Liberalization and Intersectoral Labor Movements," Research Papers 1652, Stanford University, Graduate School of Business.
  2. Andrew B Bernard & Jonathan Eaton & J. Bradford Jensen & Samuel Kortum, 2000. "Plants and productivity in international trade," Working Papers 00-08, Center for Economic Studies, U.S. Census Bureau.
  3. Currie, Janet & Harrison, Ann E, 1997. "Sharing the Costs: The Impact of Trade Reform on Capital and Labor in Morocco," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages S44-71, July.
  4. Richard B. Freeman & Lawrence F. Katz, 1991. "Industrial Wage and Employment Determination in an Open Economy," NBER Chapters, in: Immigration, Trade, and the Labor Market, pages 235-259 National Bureau of Economic Research, Inc.
  5. Revenga, Ana L, 1992. "Exporting Jobs? The Impact of Import Competition on Employment and Wages in U.S. Manufacturing," The Quarterly Journal of Economics, MIT Press, vol. 107(1), pages 255-84, February.
  6. Baltagi, Badi H. & Wu, Ping X., 1999. "Unequally Spaced Panel Data Regressions With Ar(1) Disturbances," Econometric Theory, Cambridge University Press, vol. 15(06), pages 814-823, December.
  7. Levinsohn, James, 1999. "Employment responses to international liberalization in Chile," Journal of International Economics, Elsevier, vol. 47(2), pages 321-344, April.
  8. Tornell, A., 1998. "Reform from Within," Papers 650, Harvard - Institute for International Development.
  9. Rui Albuquerque & Sergio Rebelo, 1998. "On the Dynamics of Trade Reform," NBER Working Papers 6700, National Bureau of Economic Research, Inc.
  10. 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.
  11. 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.
  12. Markusen, James R., 1981. "Trade and the gains from trade with imperfect competition," Journal of International Economics, Elsevier, vol. 11(4), pages 531-551, November.
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