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Trade Liberalization, Firm Performance and Labor Market Outcomes in the Developing World, what Can We Learn from Micro-Level Data?

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Author Info
Paolo EPIFANI

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Abstract

We review the micro-level evidence on the effects of trade and investment liberalization in the developing world. The basic findings are the following. There is evidence of trade-induced productivity gains. These gains mainly stem from output share reallocations among firms with different productivity levels and are larger in import competing sectors. There is no evidence of significant scale efficiency gains. There is evidence of a strong pro-competitive effect of trade liberalization. There is no evidence either of learning-by-exporting effects or of beneficial spillover effects from foreign owned to local firms. There is evidence of skill upgrading induced by the reallocation of market shares in favor of plants with higher skill-intensity. There is no evidence either of trade-induced increases in labor demand elasticities or of substantial employment contraction in import competing sectors.

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Article provided by SIE - Societa' Italiana degli Economisti (I) in its journal Rivista Italiana degli Economisti.

Volume (Year): 3 (2003)
Issue (Month): 5 (December)
Pages: 455-486
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Handle: RePEc:rie:review:y:2003:v:3:i:5

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References listed on IDEAS
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Full references

Cited by:
(explanations, 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.)

  1. B.N. Goldar & Sureshchand Aggarwal, 2004. "Trade liberalisation and price-cost margin in Indian industries," Indian Council for Research on International Economic Relations, New Delhi Working Papers 130, Indian Council for Research on International Economic Relations, New Delhi, India. [Downloadable!]
  2. Elena Meschi & Marco Vivarelli, 2007. "Globalization and Income Inequality," IZA Discussion Papers 2958, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Puja Vasudeva Dutta, 2004. "Trade Protection and Inter-industry Wages in India," PRUS Working Papers 27, Poverty Research Unit at Sussex, University of Sussex. [Downloadable!]
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  4. Gunjan Sharma, 2006. "Competing or Collaborating Siblings? Industrial and Trade Policies in India," Working Papers 0610, Department of Economics, University of Missouri. [Downloadable!]
  5. Jagadeesh Sivadasan & Joel Slemrod, 2006. "Tax Law Changes, Income Shifting and Measured Wage Inequality: Evidence from India," NBER Working Papers 12240, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Petia Topalova, 2004. "Trade Liberalization and Firm Productivity: The Case of India," IMF Working Papers 04/28, International Monetary Fund. [Downloadable!]
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