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Margins of Labor Market Adjustment to Trade

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  • Rafael Dix-Carneiro
  • Brian K. Kovak

Abstract

We use both longitudinal administrative data and cross-sectional household survey data to study the margins of labor market adjustment following Brazil's early 1990s trade liberalization. We document how workers and regional labor markets adjust to trade-induced changes in local labor demand, examining various adjustment margins, including earnings and wage changes; interregional migration; shifts between tradable and nontradable employment; and shifts between formal employment, informal employment, and non-employment. Our results provide insight into the regional labor market effects of trade, and have important implications for policies that address informal employment and that assist trade-displaced workers.

Suggested Citation

  • Rafael Dix-Carneiro & Brian K. Kovak, 2017. "Margins of Labor Market Adjustment to Trade," NBER Working Papers 23595, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:23595
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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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