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The Role of "Skill enhancing Trade" in Brazil: Some Evidence from Microdata

Author

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  • Bruno Cesar Araujo

    () (Instituto de Pesquisa Economica Aplicada, IPEA - Brasilia)

  • Francesco Bogliacino

    () (Universidad EAFIT and RISE Group, Medellin)

  • Marco Vivarelli

    () (Universita Cattolica, Milano; Max Planck Institute, Jena; IZA, Bonn)

Abstract

Brazil was characterised by a marked process of trade liberalisation in the '90s, resulting in a dramatic increase in the volumes of exports and imports since the year 2000.Over the same period, the relative demand for skilled labour has increased substantially. To investigate whether these two simultaneous phenomena are linked is the purpose of this paper. More in particular, this study focuses on the impact of trade openness and technology transfer on the relative demand for skilled labour in Brazilian manufacturing firms, using a unique panel database (resulting from merging three different statistical sources) of Brazilian manufacturing firms over the period 1997-2005. Descriptive statistics show that the increase in the relative demand for skilled labour was mainly driven by the within-industry variation, supporting the hypothesis that technology (and in particular technological transfer from richer countries) may have played a role in determining the skill-upgrading of Brazilian manufacturing firms. The econometric results further support this hypothesis. Indeed, the estimations show that domestic capital is a complement of the skilled workers and that imported capital goods clearly act as a skill-enhancing component of trade. Hence, our results support the view that embodied technological change through the importation of capital goods has involved a clear skill-biased impact in Brazilian manufacturin

Suggested Citation

  • Bruno Cesar Araujo & Francesco Bogliacino & Marco Vivarelli, 2009. "The Role of "Skill enhancing Trade" in Brazil: Some Evidence from Microdata," Jena Economic Research Papers 2009-041, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2009-041
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    References listed on IDEAS

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    1. repec:eee:streco:v:42:y:2017:i:c:p:56-66 is not listed on IDEAS
    2. Chahir Zaki, 2011. "On Trade Policies and Wage Disparity in Egypt: Evidence from Microeconomic Data," Working Papers 606, Economic Research Forum, revised 08 Jan 2011.
    3. repec:ipg:wpaper:2014-504 is not listed on IDEAS
    4. Ahmed Fayez Abdelgouad, 2016. "Exporting and Workforce Skills-Intensity in the Egyptian Manufacturing Firms: Empirical Evidence Using World Bank Firm-Level Data for Egypt," Working Paper Series in Economics 358, University of Lüneburg, Institute of Economics.
    5. Lanouar Charfeddine & Zouhair Mrabet, 2015. "Trade liberalization and relative employment: further evidence from Tunisia," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 5(1), pages 173-202, June.

    More about this item

    Keywords

    Skill-Enhancing Trade; Skill-bias; Panel Data; Brazil;

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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