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Labor Standards and Economic Integration in the European Union: an Empirical Analysis

Author

Listed:
  • H. Dehejia, Vivek

    (Carleton University & CESifo)

  • Samy, Yiagadeesen

    (Carleton University)

Abstract

This study is motivated by frequent calls to harmonize labor standards across countries, which result from the fear that economic integration (and the accompanying liberalization of trade flows) will lead to an erosion of working conditions, as countries deliberately try to reduce labor standards in order to maintain competitiveness. We empirically examine the conventional wisdom that labour standards are important determinants of trade performance and whether there has been a “race to the bottom” of standards across EU-15 countries with deeper integration. Our panel data estimates for the period 1980-2001 provide mixed evidence regarding the conventional wisdom and “σ-convergence” in labor standards.

Suggested Citation

  • H. Dehejia, Vivek & Samy, Yiagadeesen, 2008. "Labor Standards and Economic Integration in the European Union: an Empirical Analysis," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 23, pages 817-847.
    • Handle: RePEc:ris:integr:0455
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    References listed on IDEAS

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    1. Jai S. Mah, 1997. "Core Labour Standards and Export Performance in Developing Countries," The World Economy, Wiley Blackwell, vol. 20(6), pages 773-785, September.
    2. Andrea Bassanini & Stefano Scarpetta, 2001. "Does Human Capital Matter for Growth in OECD Countries?: Evidence from Pooled Mean-Group Estimates," OECD Economics Department Working Papers 282, OECD Publishing.
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    6. Gabriel Rodriguez & Yiagadeesen Samy, 2003. "Analysing the effects of labour standards on US export performance. A time series approach with structural change," Applied Economics, Taylor & Francis Journals, vol. 35(9), pages 1043-1051.
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    Cited by:

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    More about this item

    Keywords

    economic integration; labor standards; comparative advantage; σ-convergence;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F15 - International Economics - - Trade - - - Economic Integration
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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