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A mapping of labor mobility costs in developing countries

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  • Artuc, Erhan
  • Lederman, Daniel
  • Porto, Guido

Abstract

Estimates of labor mobility costs are needed to assess the responses of employment and wages to trade shocks when factor adjustment is costly. Available methods to estimate those costs rely on panel data, which are seldom available in developing countries. The authors propose a method to estimate mobility costs using readily obtainable data worldwide. The estimator matches the changes in observed sectoral employment allocations with the predicted allocations from a model of costly labor adjustment. This paper estimates a world map of labor mobility costs and uses those estimates to explore the response of labor markets to trade policy.

Suggested Citation

  • Artuc, Erhan & Lederman, Daniel & Porto, Guido, 2013. "A mapping of labor mobility costs in developing countries," Policy Research Working Paper Series 6556, The World Bank.
    • Handle: RePEc:wbk:wbrwps:6556
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    References listed on IDEAS

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    1. Naércio Aquino Menezes Filho & Marc-Andreas Muendler, 2007. "Labor Reallocation in Response to Trade Reform," CESifo Working Paper Series 1936, CESifo.
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    4. Goldberg, Pinelopi Koujianou & Pavcnik, Nina, 2005. "Trade, wages, and the political economy of trade protection: evidence from the Colombian trade reforms," Journal of International Economics, Elsevier, vol. 66(1), pages 75-105, May.
    5. Erhan Artuç & Shubham Chaudhuri & John McLaren, 2010. "Trade Shocks and Labor Adjustment: A Structural Empirical Approach," American Economic Review, American Economic Association, vol. 100(3), pages 1008-1045, June.
    6. Gueorgui Kambourov, 2009. "Labour Market Regulations and the Sectoral Reallocation of Workers: The Case of Trade Reforms," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(4), pages 1321-1358.
    7. Davidson, Carl & Matusz, Steven J, 2000. "Globalization and Labour-Market Adjustment: How Fast and at What Cost?," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 16(3), pages 42-56, Autumn.
    8. Artuç, Erhan & Chaudhuri, Shubham & McLaren, John, 2008. "Delay and dynamics in labor market adjustment: Simulation results," Journal of International Economics, Elsevier, vol. 75(1), pages 1-13, May.
    9. Austan Goolsbee & Amil Petrin, 2004. "The Consumer Gains from Direct Broadcast Satellites and the Competition with Cable TV," Econometrica, Econometric Society, vol. 72(2), pages 351-381, March.
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    Cited by:

    1. Elizabeth Ruppert Bulmer & Claire H. Hollweg, 2016. "The Labor Impact of Lao Export Growth," World Bank Publications - Reports 24020, The World Bank Group.
    2. Timothy Halliday & Daniel Lederman & Raymond Robertson, 2018. "Tracking wage inequality trends with prices and different trade models: evidence from Mexico," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 154(1), pages 47-73, February.
    3. Diego Rojas & Claire H. Hollweg & Elizabeth Ruppert Bulmer & Daniel Lederman, 2014. "Sticky Feet : How Labor Market Frictions Shape the Impact of International Trade on Jobs and Wages," World Bank Publications - Books, The World Bank Group, number 18777.
    4. Bi, Huixin & Shen, Wenyi & Yang, Shu-Chun S., 2016. "Fiscal limits in developing countries: A DSGE Approach," Journal of Macroeconomics, Elsevier, vol. 49(C), pages 119-130.

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    Keywords

    Labor Markets; Labor Policies; Economic Theory&Research; Work&Working Conditions; Labor Management and Relations;
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