The Impact of Trade and Labor Market Regulations on Employment and Wages: Evidence from Developing Countries
This paper examines the effects of openness and labor market rigidity on labor market outcomes in the manufacturing sector using panel data from 48 developing countries. Results from reduced form equations for employment and wages suggest hat on average trade liberalization has had a weak impact on employment and wages. At the same time, however, the effects of trade liberalization is any given country are conditional on the nature of labor market regulations: trade liberalization is more likely to have a positive impact on employment and wages in countries with flexible labor markets and vice versa. Additionally, more regulated labor markets tend to have higher average wages but these appear to come at the expense of sector wide employment.
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| Length: | 42 pages |
| Date of creation: | Aug 2001 |
| Handle: | RePEc:ewc:wpaper:wp32 |
| Contact details of provider: | Postal: 1601 East-West Road, Honolulu, Hawaii 96848 Phone: (808) 944-7560 Fax: (808) 944-7399 Web page: http://eastwestcenter.org/ Email: More information through EDIRC
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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.:
- Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, vol. 11(1), pages 33-57, January.
- Helliwell, John F., 1994.
"Empirical Linkages Between Democracy and Economic Growth,"
British Journal of Political Science,
Cambridge University Press, vol. 24(02), pages 225-248, April.
- John F. Helliwell, 1992. "Empirical Linkages Between Democracy and Economic Growth," NBER Working Papers 4066, National Bureau of Economic Research, Inc.
- Uma Karmbhampati & Pravin Krishna & Devashish Mitra, 1997. "The effect of trade policy reforms on labour markets: evidence from India," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 6(2), pages 287-297.
- Fallon, Peter R. & Lucas, Robert E. B., 1993. "Job security regulations and the dynamic demand for industrial labor in India and Zimbabwe," Journal of Development Economics, Elsevier, vol. 40(2), pages 241-275, April.
- Peter R. Fallon & Robert E. B. Lucas, 1989. "Job Security Regulations and the Dynamic Demand for Industrial Labor in India and Zimbabwe," Boston University - Institute for Economic Development 2, Boston University, Institute for Economic Development.
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