The impact of trade liberalization on manufacturing employment and wages in Egypt 1990-2007
This paper explores the impact of trade liberalization on manufacturing employment and wages over a period 1993-2006, a period coinciding with significant reduction in trade barriers and rising unemployment. Despite increasing import penetration, the paper shows that employment has increased across all manufacturing industries. Data from Egypt’s labor market survey confirm that layoffs as a result of trade liberalization is not among the factors responsible for unemployment. On the other hand, regression analysis shows that the reduction in tariffs and increasing export orientation has been associated with an increase in wages in manufacturing industries though the role of export orientation in influencing poor wages has not been significant. Meanwhile, quantile regressions reveal that the impact of both the reduction in tariffs and increase in export orientation has not been uniform across the different quantiles of the wage distribution. The paper further points out to the possibility that further reduction of trade barriers might lead to high adjustment costs in terms of long spells of unemployment or lower pay on grounds of old age and low educational attainment of Egypt’s work force. Adjustment policies in the form of direct job search assistance as country experience illustrates is considered to be the most appropriate form of adjustment assistance.
|Date of creation:||2010|
|Date of revision:|
|Publication status:||Published in International Research Journal of Finance and Economics 46 (2010): pp. 138-159|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pinelopi K. Goldberg & Nina Pavcnik, 2003.
"The Response of the Informal Sector to Trade Liberalization,"
NBER Working Papers
9443, National Bureau of Economic Research, Inc.
- Koujianou Goldberg, Pinelopi & Pavcnik, Nina, 2003. "The response of the informal sector to trade liberalization," Journal of Development Economics, Elsevier, vol. 72(2), pages 463-496, December.
- Goldberg, Pinelopi Koujianou & Pavcnik, Nina, 2003. "The Response of the Informal Sector to Trade Liberalization," CEPR Discussion Papers 3874, C.E.P.R. Discussion Papers.
- Harrison, Ann & Hanson, Gordon, 1999.
"Who gains from trade reform? Some remaining puzzles,"
Journal of Development Economics,
Elsevier, vol. 59(1), pages 125-154, June.
- Ann Harrison & Gordon Hanson, 1999. "Who Gains from Trade Reform? Some Remaining Puzzles," NBER Working Papers 6915, National Bureau of Economic Research, Inc.
- Davidson, Carl & Martin, Lawrence & Matusz, Steven, 1999. "Trade and search generated unemployment," Journal of International Economics, Elsevier, vol. 48(2), pages 271-299, August.
- Revenga, Ana, 1997. "Employment and Wage Effects of Trade Liberalization: The Case of Mexican Manufacturing," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages S20-43, July.
- Puja Vasudeva Dutta, 2004. "Trade Protection and Inter-industry Wages in India," PRUS Working Papers 27, Poverty Research Unit at Sussex, University of Sussex.
- Krueger, Alan B & Summers, Lawrence H, 1988. "Efficiency Wages and the Inter-industry Wage Structure," Econometrica, Econometric Society, vol. 56(2), pages 259-93, March.
- Attanasio, Orazio & Goldberg, Pinelopi K. & Pavcnik, Nina, 2004.
"Trade reforms and wage inequality in Colombia,"
Journal of Development Economics,
Elsevier, vol. 74(2), pages 331-366, August.
- Orazio Attanasio & Pinelopi Goldberg & Nina Pavcnik, 2003. "Trade Reforms and Wage Inequiality in Colombia," NBER Working Papers 9830, National Bureau of Economic Research, Inc.
- Attanasio, Orazio & Goldberg, Pinelopi & Pavcnik, Nina, 2003. "Trade Reforms and Wage Inequality in Colombia," CEPR Discussion Papers 4023, C.E.P.R. Discussion Papers.
- Heckman, James, 2013.
"Sample selection bias as a specification error,"
Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
- Matusz, Steven J, 1996. "International Trade, the Division of Labor, and Unemployment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(1), pages 71-84, February.
- Bernard Hoekman & Alan L. Winters, 2005.
"Trade and Employment: Stylized Facts and Research Findings,"
7, United Nations, Department of Economics and Social Affairs.
- Hoekman & Bernard & Winters, L. Alan, 2005. "Trade and employment : stylized facts and research findings," Policy Research Working Paper Series 3676, The World Bank.
- Matusz, Steven J. & Tarr, David, 1999. "Adjusting to trade policy reform," Policy Research Working Paper Series 2142, The World Bank.
- Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
- Lori G. Kletzer, 2001. "Job Loss from Imports: Measuring the Costs," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 110, January.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:25759. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.