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Trade Technology and Employment: A case Study of South Africa

Author

Listed:
  • J. Paul Dunne

    (School of Economics, University of the West of England)

  • Lawrence Edwards

    (School of Economics, University of Cape Town)

Abstract

This paper provides a comprehensive analysis of the impact of trade on employment in South Africa. Firstly, it considers the correlation between trade liberalisation and factor demand in South African manufacturing during the 1990s. Secondly, it investigates the impact of trade on labour using a Chenery (1979) style decomposition technique, following Edwards (2001a, 2001b, 2005b) and Jenkins (2002). It develops the earlier work by exploring both the indirect and the indirect effects and investigating variations in the regional impact of trade on factor demand during the 1990s. This suggests that technological change accounts for the bulk of jobs lost in manufacturing during the 1990s. To investigate, whether this reflects exogenous technological change or trade-induced technological change requires undertaking an econometric analysis and this explores the impact of trade on technological change through an induced labour demand model. This finds a strong effect of exogenous technological progress but only limited evidence that increased trade flows and trade liberalisation induced improvements in labour productivity.

Suggested Citation

  • J. Paul Dunne & Lawrence Edwards, 2006. "Trade Technology and Employment: A case Study of South Africa," Working Papers 0602, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    • Handle: RePEc:uwe:wpaper:0602
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    References listed on IDEAS

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    Cited by:

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    2. Haroon Bhorat & Sumayya Goga & Benjamin Stanwix, 2014. "Skills-Biased Labour Demand and the Pursuit of Inclusive Growth in South Africa," WIDER Working Paper Series wp-2014-130, World Institute for Development Economic Research (UNU-WIDER).
    3. Adekunle, Ademola & Osazuwa, Peter & Raghavan, Vijaya, 2016. "Socio-economic determinants of agricultural mechanisation in Africa: A research note based on cassava cultivation mechanisation," Technological Forecasting and Social Change, Elsevier, vol. 112(C), pages 313-319.
    4. Fiandeiro, M. Fatima & Rankin, Neil A., 2008. "Trade liberalisation and wages in South African manufacturing," MPRA Paper 17066, University Library of Munich, Germany.
    5. Haroon Bhorat & Karmen Naidoo & Morné Oosthuizen & Kavisha Pillay, 2015. "Demographic, employment, and wage trends in South Africa," WIDER Working Paper Series 141, World Institute for Development Economic Research (UNU-WIDER).
    6. David KUCERA & Leanne RONCOLATO, 2011. "Trade liberalization, employment and inequality in India and South Africa," International Labour Review, International Labour Organization, vol. 150(1-2), pages 1-41, June.
    7. Haroon Bhorat & Karmen Naidoo & Morné Oosthuizen & Kavisha Pillay, 2015. "Demographic, employment, and wage trends in South Africa," WIDER Working Paper Series wp-2015-141, World Institute for Development Economic Research (UNU-WIDER).
    8. Ebru Voyvoda, 2009. "Sources of Structural Change and its Impact on Interdependence: An Input-Output Perspective for The Post-1980 Turkish Economy," Working Papers 507, Economic Research Forum, revised Dec 2009.
    9. Bishwanath Goldar, 2009. "Impact of Trade on Employment Generation in Manufacturing in India," Trade Working Papers 22921, East Asian Bureau of Economic Research.

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    Keywords

    Trade; technology; employment; industrial panel;
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