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What Does South Africa's Pattern of Trade Say About its Labor Markets?

Author

Listed:
  • Arvind Subramanian
  • Trevor Serge Coleridge Alleyne

Abstract

This paper examines the factor intensity of South Africa's trade. The conclusion is that South Africa is revealed though its trade pattern to be capital abundant (relative to labor). Surprisingly, this result holds especially for South Africa's trade with its high income partners, which should presumably have been more capital-rich than South Africa. Moreover, this revealed capital intensity of South African production was not reversed during the 1990s after the dismantling of apartheid. This favoring of capital use, against the background of high and rising under-utilization of the country's labor resources, raises questions about the functioning of South Africa's labor market institutions.

Suggested Citation

  • Arvind Subramanian & Trevor Serge Coleridge Alleyne, 2001. "What Does South Africa's Pattern of Trade Say About its Labor Markets?," IMF Working Papers 01/148, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:01/148
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    References listed on IDEAS

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    1. By Gunnar Jonsson & Arvind Subramanian, 2001. "Dynamic Gains from Trade: Evidence from South Africa," IMF Staff Papers, Palgrave Macmillan, vol. 48(1), pages 1-8.
    2. Deardorff, Alan V., 1984. "Testing trade theories and predicting trade flows," Handbook of International Economics,in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 10, pages 467-517 Elsevier.
    3. Leamer, Edward E, 1980. "The Leontief Paradox, Reconsidered," Journal of Political Economy, University of Chicago Press, vol. 88(3), pages 495-503, June.
    4. Harry P. Bowen & Leo Sveikauskas, 1992. "Judging Factor Abundance," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 599-620.
    5. Dalia S Hakura, 1999. "A Test of the General Validity of the Heckscher-Ohlin Theorem for Trade in the European Community," IMF Working Papers 99/70, International Monetary Fund.
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    Citations

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    Cited by:

    1. Nathan Nunn & Daniel Trefler, 2010. "The Structure of Tariffs and Long-Term Growth," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(4), pages 158-194, October.
    2. Kochhar, Kalpana & Kumar, Utsav & Rajan, Raghuram & Subramanian, Arvind & Tokatlidis, Ioannis, 2006. "India's pattern of development: What happened, what follows?," Journal of Monetary Economics, Elsevier, vol. 53(5), pages 981-1019, July.
    3. Rhys Jenkins, 2006. "Globalization and the labour market in South Africa," Journal of International Development, John Wiley & Sons, Ltd., vol. 18(5), pages 649-664.
    4. J. Paul Dunne & Lawrence Edwards, 2006. "Trade Technology and Employment: A case Study of South Africa," Working Papers 0602, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    5. Lawrence Edwards & Robert Z. Lawrence, 2006. "South African Trade Policy Matters: Trade Performance and Trade Policy," NBER Working Papers 12760, National Bureau of Economic Research, Inc.
    6. John Whalley & J. Clark Leith, 2003. "Competitive Liberalization and a US-SACU FTA," NBER Working Papers 10168, National Bureau of Economic Research, Inc.
    7. Nathan Nunn & Daniel Trefler, 2006. "Putting the Lid on Lobbying: Tariff Structure and Long-Term Growth when Protection is for Sale," NBER Working Papers 12164, National Bureau of Economic Research, Inc.

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