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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
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    References listed on IDEAS

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    1. Levinsohn, James, 1999. "Employment responses to international liberalization in Chile," Journal of International Economics, Elsevier, vol. 47(2), pages 321-344, April.
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    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.
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    Cited by:

    1. 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.
    2. Novella Bottini & Michael Gasiorek, 2009. "Trade and Job Reallocation: Evidence for Morocco," Working Papers 492, Economic Research Forum, revised Jun 2009.
    3. Rzigui, Lotfi, 2005. "External shocks and economic fluctuations: evidence from Tunisia," MPRA Paper 630, University Library of Munich, Germany, revised Dec 2005.

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    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

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