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Job creation, job destruction, and international competition: a literature review

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  • Michael W. Klein
  • Scott Schuh
  • Robert K. Triest

Abstract

This paper is a chapter in our forthcoming monograph, Job Creation, Job Destruction, and International Competition (W.E. Upjohn Institute, 2003), and expands on the ideas advanced in Klein, Schuh, and Triest (2003). The chapter provides an extensive review of the literature that studies the connection between international factors, such as real exchange rates and trade agreements, and the domestic labor market. Until recently, the literature has focused on the effects of international factors on net employment at aggregate levels or in selected import-competing industries. In the long run, aggregate net employment largely is unaffected by international factors, whereas these factors have important allocative effects in the short and long run, both between and within detailed industries. Thus, it is appropriate to study the components of net employment - gross job creation and destruction - when measuring the impact of international factors on labor markets. Examining gross job and worker turnover associated with changes in international factors raises questions about the accuracy of prior estimates of adjustment costs associated with international factors because gross flows are an order of magnitude larger than net employment flows.

Suggested Citation

  • Michael W. Klein & Scott Schuh & Robert K. Triest, 2002. "Job creation, job destruction, and international competition: a literature review," Working Papers 02-7, Federal Reserve Bank of Boston.
  • Handle: RePEc:fip:fedbwp:02-7
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    References listed on IDEAS

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    Cited by:

    1. Edgar Trujillo C. & Carlos Esteban Posada, 2006. "El Proteccionismo No Arancelario Y La Coyuntura Económica: El Caso Colombiano Reciente (1990-2005)," Borradores de Economia 399, Banco de la Republica de Colombia.
    2. Ligia Melo & Carlos Ballesteros, 2014. "The impact of external factors on job creation and destruction in the Colombian manufacturing sector," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 81, pages 155-186, Julio - D.
    3. repec:rim:rimwps:27-08 is not listed on IDEAS
    4. Fernando Alexandre & Pedro Bação & João Cerejeira & Miguel Portela, 2011. "Employment and Exchange Rates: The Role of Openness and Technology," Open Economies Review, Springer, vol. 22(5), pages 969-984, November.
    5. Douglas L. Campbell, 2013. "Relative Prices, Hysteresis, and the Decline of American Manufacturing," 2013 Papers pca584, Job Market Papers.
    6. Lo Turco, Alessia & Maggioni, Daniela & Picchio, Matteo, 2013. "Offshoring and job stability: Evidence from Italian manufacturing," Structural Change and Economic Dynamics, Elsevier, vol. 26(C), pages 27-46.
    7. Nucci, Francesco & Pozzolo, Alberto Franco, 2010. "The exchange rate, employment and hours: What firm-level data say," Journal of International Economics, Elsevier, vol. 82(2), pages 112-123, November.
    8. Rosario Crinò, 2007. "Offshoring, Multinationals and Labor Market: A Review of the Empirical Literature," KITeS Working Papers 196, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Jan 2007.
    9. Castilho, Marta Reis, 2004. "Integração regional e conteúdo de trabalho do comércio exterior brasileiro," Oficina de la CEPAL en Brasilia (Estudios e Investigaciones) 37924, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    10. Ligia Alba Melo & Carlos Andrés Ballesteros, 2013. "Creación, destrucción y reasignación del empleo en el sector manufacturero colombiano," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 15(28), pages 281-311, January-J.
    11. Nurmi, Satu, 2004. "Employment Dynamics and Openness to Trade in Finnish Manufacturing," Discussion Papers 956, The Research Institute of the Finnish Economy.
    12. Pozzolo, Alberto Franco & Nucci, Francesco, 2008. "Exchange Rate, Employment and Hours: What Firm-Level Data Say," Economics & Statistics Discussion Papers esdp08049, University of Molise, Dept. EGSeI.
    13. Sebastiano Manzan & Howard N. Ross, 2011. "U.S. Manufacturing: Productivity, Offshoring, and Imports," Economics Bulletin, AccessEcon, vol. 31(4), pages 2875-2883.
    14. Egger, Peter & Pfaffermayr, Michael & Weber, Andrea, 2003. "Sectoral Adjustment of Employment: The Impact of Outsourcing and Trade at the Micro Level," IZA Discussion Papers 921, Institute for the Study of Labor (IZA).
    15. Mark Gius, 2006. "Using Panel Data to Estimate the Effect of the North American Free Trade Agreement on Employment and Wages at the State Level," New York Economic Review, New York State Economics Association (NYSEA), vol. 37(1), pages 20-31.

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    Keywords

    Employment (Economic theory) ; Unemployment ; Foreign exchange rates ; Labor turnover ; Labor market;

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