IDEAS home Printed from https://ideas.repec.org/p/mon/ceddtr/94.html
   My bibliography  Save this paper

Trade liberalization and demand labor elasticities : evidence from Tunisia

Author

Listed:
  • Ilham Haouas

    (TEAM, Université Paris I)

  • Mahmoud Yagoubi

    (MATISSE, Université Paris I)

Abstract

Ce papier étudie les effets de la libéralisation des échanges sur les élasticités de la demande du travail. Une équation de demande d'emploi est estimée en se fondant sur des données (1971-1996) portant sur six industries manufacturières tunisiennes. Les résultats des tests économétriques ne vérifient pas l'idée que la libéralisation des échanges peut permettre une augmentation de l'élasticité de la demande du travail. Dans la majorité des industries considérées, l'hypothèse de l'absence d'une relation entre l'ouverture commerciale et l'élasticité demande de travail ne peut pas être rejetée. La faiblesse de l'élasticité de demande de travail peut être expliquée par les régulations du marché du travail mises en place durant 1987-1996. Cependant, les résultats sont robustes par rapport au type de statut du travail considéré (main-d'oeuvre contractuelle et permanente). Ces résultats confortent l'idée qu'au cours de la période de libéralisation, le marché du travail est devenu plus flexible, et que les chefs d'entreprise préfèrent embaucher des travailleurs contractuels. This paper investigates the effects of trade liberalization on labor demand elasticities. Employment demand equation is estimated by using data (1971-1996) for manufacturing industries in Tunisia. Results from empirical testing using the model find a weak support for the idea assuming that trade liberalization will lead to an increase in labor demand elasticities: in the vast majority of the industries we consider, we cannot reject the hypothesis of no relationship between trade openness and labor-demand elasticities. This weakness of labor demand elasticity in practice is perhaps explained by the tight labor market regulations in place during the 1987-96. However, our results are robust to the type of labor considered (contract labor and permanent labor). This supports the conclusion that under liberalization period labor markets have become more flexible, and that employers prefer recruiting contracts worker. (Full text in english)

Suggested Citation

  • Ilham Haouas & Mahmoud Yagoubi, 2004. "Trade liberalization and demand labor elasticities : evidence from Tunisia," Documents de travail 94, Groupe d'Economie du Développement de l'Université Montesquieu Bordeaux IV.
    • Handle: RePEc:mon:ceddtr:94
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    References listed on IDEAS

    as
    1. Levinsohn, James, 1999. "Employment responses to international liberalization in Chile," Journal of International Economics, Elsevier, vol. 47(2), pages 321-344, April.
    2. Fajnzylber, Pablo & Maloney, William F., 2005. "Labor demand and trade reform in Latin America," Journal of International Economics, Elsevier, vol. 66(2), pages 423-446, July.
    3. Feenstra, Robert C & Hanson, Gordon H, 1996. "Globalization, Outsourcing, and Wage Inequality," American Economic Review, American Economic Association, vol. 86(2), pages 240-245, May.
    4. Krishna, Pravin & Mitra, Devashish & Chinoy, Sajjid, 2001. "Trade liberalization and labor demand elasticities: evidence from Turkey," Journal of International Economics, Elsevier, vol. 55(2), pages 391-409, December.
    5. Ilham Haouas & Mahmoud Yagoubi & Almas Heshmati, 2002. "Labour-Use Efficiency in Tunisian Manufacturing Industries: A Flexible Adjustment Model," WIDER Working Paper Series DP2002-103, World Institute for Development Economic Research (UNU-WIDER).
    6. Luca Papi & Alberto Zazzaro, 2000. "How Does the EU Agenda Influence Economies outside the EU? The Case of Tunisia," Development Working Papers 148, Centro Studi Luca d'Agliano, University of Milano.
    7. 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.
    8. Beyer, Harald & Rojas, Patricio & Vergara, Rodrigo, 1999. "Trade liberalization and wage inequality," Journal of Development Economics, Elsevier, vol. 59(1), pages 103-123, June.
    9. Ilham Haouas & Mahmoud Yagoubi & Almas Heshmati, 2005. "The impacts of trade liberalization on employment and wages in Tunisian industries," Journal of International Development, John Wiley & Sons, Ltd., vol. 17(4), pages 527-551.
    10. Rana Hasan & Devashish Mitra & K.V. Ramaswamy, 2007. "Trade Reforms, Labor Regulations, and Labor-Demand Elasticities: Empirical Evidence from India," The Review of Economics and Statistics, MIT Press, vol. 89(3), pages 466-481, August.
    11. Gordon H. Hanson & Ann Harrison, 2022. "Trade Liberalization And Wage Inequality In Mexico," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 3, pages 43-60, World Scientific Publishing Co. Pte. Ltd..
    12. Matthew J. Slaughter, 1997. "International Trade and Labor-Demand Elasticities," NBER Working Papers 6262, National Bureau of Economic Research, Inc.
    13. Richard A. Brecher, 1974. "Minimum Wage Rates and the Pure Theory of International Trade," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 88(1), pages 98-116.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Novella Bottini & Michael Gasiorek, 2009. "Trade and Job Reallocation: Evidence for Morocco," Working Papers 492, Economic Research Forum, revised Jun 2009.
    2. Bushra Yasmin & Aliya H. Khan, 2011. "Trade Openness: New Evidence for Labor-Demand Elasticity in Pakistan's Manufacturing Sector," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 16(2), pages 55-85, Jul-Dec.
    3. Rzigui, Lotfi, 2005. "External shocks and economic fluctuations: evidence from Tunisia," MPRA Paper 630, University Library of Munich, Germany, revised Dec 2005.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Haouas, Ilham & Yagoubi, Mahmoud, 2004. "Trade Liberalization and Labor-Demand Elasticities: Empirical Evidence from Tunisia," IZA Discussion Papers 1084, Institute of Labor Economics (IZA).
    2. Martin Rama, 2002. "Globalization and Workers in Developing Countries," Economics Study Area Working Papers 41, East-West Center, Economics Study Area.
    3. Michael Gasiorek, 2007. "Determinants of Productivity in Morocco: The Role of Trade?," Working Papers 716, Economic Research Forum, revised 01 Jan 2007.
    4. Hijzen, Alexander & Swaim, Paul, 2010. "Offshoring, labour market institutions and the elasticity of labour demand," European Economic Review, Elsevier, vol. 54(8), pages 1016-1034, November.
    5. Mine Zeynep Senses, 2006. "The Effects of Outsourcing on the Elasticity of Labor Demand," Working Papers 06-07, Center for Economic Studies, U.S. Census Bureau.
    6. Ilham Haouas & Mahmoud Yagoubi & Almas Heshmati, 2005. "The impacts of trade liberalization on employment and wages in Tunisian industries," Journal of International Development, John Wiley & Sons, Ltd., vol. 17(4), pages 527-551.
    7. Devashish Mitra, 2001. "Trade Liberalization, Labor Markets and Imperfect Competition," Economics Study Area Working Papers 29, East-West Center, Economics Study Area.
    8. Ilham Haouas & Mahmoud Yagoubib, 2007. "The effect of international trade on labour-demand elasticities: empirical evidence from Tunisia," Applied Economics Letters, Taylor & Francis Journals, vol. 15(4), pages 277-286.
    9. Kölling, Arnd & Mertens, Antje, 2020. "Exporting behavior and the demand for skills in German establishments," Working Papers 97, Berlin School of Economics and Law, Institute of Management Berlin (IMB).
    10. Carlos Arango Arango & Angela Milena Rojas, 2003. "Demanda Laboral en el Sector Manufacturero COlombiano: 1977-1999," Borradores de Economia 247, Banco de la Republica de Colombia.
    11. Jorge Saba Arbache, 2001. "Trade Liberalisation and Labor Markets in Developing Countries: Theory and Evidence," Studies in Economics 0112, School of Economics, University of Kent.
    12. Dawood Mamoon, 2015. "How May International Trade affect Poverty in a Developing Country Setup? The Inequality Channel," International Journal of Economics and Empirical Research (IJEER), The Economics and Social Development Organization (TESDO), vol. 3(5), pages 230-244, May.
    13. Paolo Epifani, 2003. "Trade liberalization, Firm Performances and Labor Market Outcomes in the Developing World, what Can We Learn From Micro-Level Data?," Rivista italiana degli economisti, Società editrice il Mulino, issue 3, pages 455-486.
    14. Devashish Mitra, 2019. "Responses to Trade Opening: Evidence and Lessons from Asia," Working Papers id:12977, eSocialSciences.
    15. Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2015. "The own-wage elasticity of labor demand: A meta-regression analysis," European Economic Review, Elsevier, vol. 80(C), pages 94-119.
    16. Bushra Yasmin & Aliya H. Khan, 2011. "Trade Openness: New Evidence for Labor-Demand Elasticity in Pakistan's Manufacturing Sector," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 16(2), pages 55-85, Jul-Dec.
    17. Andreas Lichter & Andreas Peichl & Sebastian Siegloch, 2017. "Exporting and labour demand: Micro-level evidence from Germany," Canadian Journal of Economics, Canadian Economics Association, vol. 50(4), pages 1161-1189, November.
    18. Hanan Nazier, 2019. "Estimating Labor Demand Elasticities and Elasticities of Substitution in Egyptian Manufacturing Sector: A Firm-Level Static Analysis," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 62(4), pages 549-575, December.
    19. repec:eee:labchp:v:3:y:1999:i:pb:p:2215-2288 is not listed on IDEAS
    20. repec:dau:papers:123456789/11536 is not listed on IDEAS
    21. Johannes Fedderke & Yongcheol Shin & Prabhat Vaze, 2003. "Trade, Technology and Wage Inequality in the South African Manufacturing Sectors," Edinburgh School of Economics Discussion Paper Series 106, Edinburgh School of Economics, University of Edinburgh.
    22. Sly, Nicholas & Soderbery, Anson, 2014. "Strategic sourcing and wage bargaining," Journal of Development Economics, Elsevier, vol. 109(C), pages 172-187.

    More about this item

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mon:ceddtr:94. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.