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Liberalized Trade and Worker-Firm Matching

Author

Listed:
  • Davidson, Carl

    (Michigan State University)

  • Heyman, Fredrik

    (The Research Institute of Industrial Economics, Sweden)

  • Matusz, Steven

    (Michigan State University)

  • Sjöholm, Fredrik

    () (Department of Economics, Lund University)

  • Zhu, Susan Chun

    (Michigan State University)

Abstract

Recent theoretical analysis suggests that a reduction in the cost of exporting increases the degree of assortative matching between workers and firms in export-oriented industries. Changes that reduce the cost of imports have an ambiguous impact on matching. We combine detailed Swedish matched worker-firm data from 1995 – 2005 with tariff data to test these hypotheses. The data cover 94 sectors subject to international competition and includes all firms with at least 20 employees. Our findings strongly support the theoretical predictions.

Suggested Citation

  • Davidson, Carl & Heyman, Fredrik & Matusz, Steven & Sjöholm, Fredrik & Zhu, Susan Chun, 2012. "Liberalized Trade and Worker-Firm Matching," Working Papers 2012:3, Lund University, Department of Economics.
  • Handle: RePEc:hhs:lunewp:2012_003
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    File URL: http://project.nek.lu.se/publications/workpap/papers/WP12_3.pdf
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    References listed on IDEAS

    as
    1. Davidson, Carl & Heyman, Fredrik & Matusz, Steven & Sjöholm, Fredrik & Zhu, Susan Chun, 2014. "Globalization and imperfect labor market sorting," Journal of International Economics, Elsevier, vol. 94(2), pages 177-194.
    2. John M. Abowd & Francis Kramarz & David N. Margolis, 1999. "High Wage Workers and High Wage Firms," Econometrica, Econometric Society, vol. 67(2), pages 251-334, March.
    3. Elhanan Helpman & Oleg Itskhoki & Stephen Redding, 2010. "Inequality and Unemployment in a Global Economy," Econometrica, Econometric Society, vol. 78(4), pages 1239-1283, July.
    4. A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
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    Citations

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    Cited by:

    1. Davidson, Carl & Heyman, Fredrik & Matusz, Steven & Sjöholm, Fredrik & Zhu, Susan Chun, 2014. "Globalization and imperfect labor market sorting," Journal of International Economics, Elsevier, vol. 94(2), pages 177-194.
    2. Araújo, Bruno César & Paz, Lourenço S., 2014. "The effects of exporting on wages: An evaluation using the 1999 Brazilian exchange rate devaluation," Journal of Development Economics, Elsevier, vol. 111(C), pages 1-16.
    3. Inga Heiland & Wilhelm Kohler, 2013. "Heterogeneous Workers, Trade, and Migration," CESifo Working Paper Series 4387, CESifo Group Munich.
    4. Davidson, Carl & Heyman, Fredrik & Matusz, Steven & Sjöholm, Fredrik & Zhu, Susan Chun, 2017. "Global engagement and the occupational structure of firms," European Economic Review, Elsevier, vol. 100(C), pages 273-292.
    5. Nunn, Nathan & Trefler, Daniel, 2014. "Domestic Institutions as a Source of Comparative Advantage," Handbook of International Economics, Elsevier.
    6. Ronald B. Davies & Arman Mazhikeyev, 2015. "The Glass Border: Gender and Exporting in Developing Countries," Working Papers 201525, School of Economics, University College Dublin.
    7. Vandenberg, Paul, 2017. "Can Trade Help Achieve the Employment Targets of the Sustainable Development Goals?," ADBI Working Papers 650, Asian Development Bank Institute.
    8. Burhan, Nik Ahmad Sufian & Sidek, Abdul Halim & Kurniawan, Yohan & Mohamad, Mohd Rosli, 2014. "Has Globalization Triggered Collective Impact of National Intelligence on Economic Growth?," MPRA Paper 77316, University Library of Munich, Germany.

    More about this item

    Keywords

    Matching; Globalization; Firms; Workers; Multinational Enterprises; International Trade;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General

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