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Revisiting the Impact of Trade Openness on Informal and Irregular Employment in Egypt

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  • Salem, Mélika Ben

    (ERUDITE, Université Paris-Est Marne-la-Vallée and Paris School of Economics)

  • Zaki, Chahir

    (Cairo University, EMNES and ERF, Cairo, Egypt)

Abstract

This study examines the impact of trade openness on job quality, measured by the share of informal and irregular employment in total employment. By combining a microeconomic dataset (the Egyptian Labor Market Panel Survey) with macroeconomic variables (tariffs), we assess the effect of trade reforms on informal/irregular workers in Egypt. Our main findings show that there is a positive association between tariffs and both informal and irregular employments in Egypt. This effect is likely because the least productive informal firms will be forced to exit the industry and only the most productive (formal) firms will export to the international markets. This will increase the demand for formal (and eventually regular) workers that are usually more skilled and, in turn, lead to a likely decline in informal (and irregular) employment. While this effect on informality is robust, the one on irregularity is not.

Suggested Citation

  • Salem, Mélika Ben & Zaki, Chahir, 2019. "Revisiting the Impact of Trade Openness on Informal and Irregular Employment in Egypt," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 34(3), pages 465-497.
    • Handle: RePEc:ris:integr:0778
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    References listed on IDEAS

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    1. Zaki, Chahir & Selwaness, Irène, 2012. "Assessing the Impact of Trade Reforms on Informality in Egypt," Conference papers 332191, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
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    Cited by:

    1. Giorgia Giovannetti & Enrico Marvasi & Arianna Vivoli, 2020. "The asymmetric effects of twenty years of tariff reforms on Egyptian workers," Working Papers LuissLab 20156, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    2. Giorgia Giovannetti & Enrico Marvasi & Arianna Vivoli, 2021. "The asymmetric effects of 20 years of tariff reforms on Egyptian workers," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(1), pages 89-130, April.
    3. Kazi Mohammed Kamal Uddin & Munem Ahmad Chowdhury, 2020. "Impact of FDI on Employment Level in Bangladesh: A VECM Approach," International Journal of Applied Economics, Finance and Accounting, Online Academic Press, vol. 8(1), pages 30-37.
    4. HAYAKAWA,Kazunobu & KEOLA, Souknilanh & SUDSAWASD, Sasatra & YAMANOUCHI, Kenta, 2024. "International Bridges and Informality," IDE Discussion Papers 914, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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    More about this item

    Keywords

    Irregular employment; informal employment; Egypt; trade reforms;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F20 - International Economics - - International Factor Movements and International Business - - - General

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