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Author: Han Wang
Publisher:
ISBN:
Category :
Languages : en
Pages :
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This dissertation contains three essays on how value-added trade affect the U.S. labor market outcomes. In the most recent presidential competition, we observed how voter angst against economic globalization had a considerable impact on the election results. This dissertation seeks to shed light on how the changes in exposure to value-added trade affect individual wages, the probability of being unemployed as well as the likelihood of being married with consideration of each worker's occupation, the level of skill, and gender. In the first essay, we link U.S. industry-level value-added trade data with U.S. worker-level data from the Current Population Surveys from 1995 to 2009. We find that U.S. occupational exposure to value-added imports has a negative effect on the wages earned by intermediate-routine workers, which leads to wage polarization among American workers. In particular, the polarization of wages is driven by occupational exposure to value-added imports of final goods from middle-income countries, while exposure to final goods imported from high-income countries has a negative, albeit more fairly distributed, effect across U.S. workers' wages. On the other hand, occupational exposure to value-added imports of intermediate goods from middle-income countries is associated with a positive wage effect for least-routine workers, signaling to the presence of strong complementarities between the group of least-routine workers and imports of intermediate goods from this group of countries. In the second essay, we investigate the contribution of the degree of occupation routineness and the level of a worker's skill in determining the effects of U.S. exposure to value-added trade on U.S. labor market outcomes. We apply three main approaches to examine how the interplay between routineness and skills is essential in explaining the effects of U.S. exposure to value-added trade flows. First, we find that the increase in occupational exposure to value-added imports of final goods from middle-income countries is the primary driver of polarization of wages in the U.S. labor market within each skill group, where the effect on workers in the occupations with moderate levels of routineness is most adversely affected. Comparing the wage effects for workers within each routineness group, we find that skilled workers tend to face smaller pressure on their wages from import competition than the unskilled. Second, we examine the impact of exposure to value-added trade on the probability of being unemployed at the worker level. We show that an increase in exposure to value-added imports will raise the employment-related uncertainty for unskilled workers relative to skilled workers. Third, we estimate the transition costs across workers who have trade-induced occupation switches between two consecutive periods. Results suggest that occupation switch is very costly for all unskilled workers as well as for the skilled workers who are involved with the least-routine occupations. Notice that the effect of trade might not be gender-neutral. In the third paper, we complement the existing literature by providing evidence that increasing import exposure has differential effects on individual outcomes depending on the workers' gender and on the degree of routineness of their occupations. We explore the effects of gender-specific exposure to value-added trade on individual outcomes such as wages, the probability of being unemployed, and the likelihood of being married. Despite that the male-specific exposures to value-added trade are highly comparable to those female-specific measures, we find it is powerful enough to distinguish their differential effects across gender. We find that the effect of trade is symmetric across genders when it comes to wage effects but asymmetric in terms of the probability of being unemployed and in the likelihood of being married. Our findings on wages suggest that an increase in exposure to value-added imports has the most negative effect on intermediate-routine workers for both gender groups, which results in wage polarization for both groups. As for the probability of being unemployed, we find that the greater the male-specific exposure to value-added imports, the greater the chances of being unemployed for male workers in the intermediate-routine occupations, while the effects for other men are insignificant. In the case of female workers, rising import exposure is associated with an increase in the uncertainty related to unemployment for those in least-routine occupations. Finally, for the likelihood of getting married, the effect for female workers is insignificant regardless of the degree of routineness. In the case of men, the likelihood of getting married decreases for males in intermediate-routine occupations when exposure to imported final goods increases, while, on the other hand, males in least-routine occupations are more likely to get married with an increase in exposure to intermediate inputs.
Author: Han Wang
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
This dissertation contains three essays on how value-added trade affect the U.S. labor market outcomes. In the most recent presidential competition, we observed how voter angst against economic globalization had a considerable impact on the election results. This dissertation seeks to shed light on how the changes in exposure to value-added trade affect individual wages, the probability of being unemployed as well as the likelihood of being married with consideration of each worker's occupation, the level of skill, and gender. In the first essay, we link U.S. industry-level value-added trade data with U.S. worker-level data from the Current Population Surveys from 1995 to 2009. We find that U.S. occupational exposure to value-added imports has a negative effect on the wages earned by intermediate-routine workers, which leads to wage polarization among American workers. In particular, the polarization of wages is driven by occupational exposure to value-added imports of final goods from middle-income countries, while exposure to final goods imported from high-income countries has a negative, albeit more fairly distributed, effect across U.S. workers' wages. On the other hand, occupational exposure to value-added imports of intermediate goods from middle-income countries is associated with a positive wage effect for least-routine workers, signaling to the presence of strong complementarities between the group of least-routine workers and imports of intermediate goods from this group of countries. In the second essay, we investigate the contribution of the degree of occupation routineness and the level of a worker's skill in determining the effects of U.S. exposure to value-added trade on U.S. labor market outcomes. We apply three main approaches to examine how the interplay between routineness and skills is essential in explaining the effects of U.S. exposure to value-added trade flows. First, we find that the increase in occupational exposure to value-added imports of final goods from middle-income countries is the primary driver of polarization of wages in the U.S. labor market within each skill group, where the effect on workers in the occupations with moderate levels of routineness is most adversely affected. Comparing the wage effects for workers within each routineness group, we find that skilled workers tend to face smaller pressure on their wages from import competition than the unskilled. Second, we examine the impact of exposure to value-added trade on the probability of being unemployed at the worker level. We show that an increase in exposure to value-added imports will raise the employment-related uncertainty for unskilled workers relative to skilled workers. Third, we estimate the transition costs across workers who have trade-induced occupation switches between two consecutive periods. Results suggest that occupation switch is very costly for all unskilled workers as well as for the skilled workers who are involved with the least-routine occupations. Notice that the effect of trade might not be gender-neutral. In the third paper, we complement the existing literature by providing evidence that increasing import exposure has differential effects on individual outcomes depending on the workers' gender and on the degree of routineness of their occupations. We explore the effects of gender-specific exposure to value-added trade on individual outcomes such as wages, the probability of being unemployed, and the likelihood of being married. Despite that the male-specific exposures to value-added trade are highly comparable to those female-specific measures, we find it is powerful enough to distinguish their differential effects across gender. We find that the effect of trade is symmetric across genders when it comes to wage effects but asymmetric in terms of the probability of being unemployed and in the likelihood of being married. Our findings on wages suggest that an increase in exposure to value-added imports has the most negative effect on intermediate-routine workers for both gender groups, which results in wage polarization for both groups. As for the probability of being unemployed, we find that the greater the male-specific exposure to value-added imports, the greater the chances of being unemployed for male workers in the intermediate-routine occupations, while the effects for other men are insignificant. In the case of female workers, rising import exposure is associated with an increase in the uncertainty related to unemployment for those in least-routine occupations. Finally, for the likelihood of getting married, the effect for female workers is insignificant regardless of the degree of routineness. In the case of men, the likelihood of getting married decreases for males in intermediate-routine occupations when exposure to imported final goods increases, while, on the other hand, males in least-routine occupations are more likely to get married with an increase in exposure to intermediate inputs.
Author: Tommaso Tempesti
Publisher:
ISBN:
Category : Electronic dissertations
Languages : en
Pages : 113
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Author: Erwin Winkler
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Rodrigo Rodrigues Adão
Publisher:
ISBN:
Category :
Languages : en
Pages : 213
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This thesis develops empirical methodologies to investigate the effect of globalization on welfare and inequality both between- and within-countries. The first essay proposes a Roy-like model where workers are heterogeneous ill terms of their comparative and absolute advantage. We show that the schedules of comparative and absolute advantage (i) determine changes in the average and the variance of the log-wage distribution, and (ii) are nonparamnetrically identified from the cross-regional variation in the sectoral responses of employment and wages to observable sector-level demand shifters. Applying these results, we find that the rise in world commodity prices accounts for 5-10% of the fall in Brazilian wage inequality between 1991 and 2010. The second essay develops a methodology to construct nonparametric counterfactual predictions, free of functional-form restrictions on preferences and technology, in neoclassical models of international trade. First, we establish the equivalence between such models and reduced exchange models in which countries directly exchange factor services. This equivalence implies that, for an arbitrary change in trade costs, counterfactual changes in factor prices, and welfare only depend on the shape of a reduced factor demand system. Second, we provide sufficient conditions for the nionparainetric identification of this system. Together, these results offer a strict generalization of the parametric approach used in so-called gravity models. Finally, we use China's recent integration into the world economy to illustrate tile feasibility of our approach. The third essay investigates the connection between the recent rise in services trade and changes in labor market outcomes in different countries. We develop a theoretical framework where trade in services arises from the spatial unbundling of workers' task output. Transmission costs endogenously determine the magnitude of between-sector task trade both within a country ("outsourcing") and between countries ("offshoring"). We show that, while differentials in sectoral task prices decrease in response to outsourcing, they increase in response to offshoring. The heterogeneity in the composition of workers' task endowments controls responses in between- and within-sector wage inequality across countries.
Author: Tian Liu
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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This dissertation consists of three essays at the crossroads of international trade and the labor market. We measure the degree of uncertainty using a general and well-established methodology based on Baker et al. (2016). We investigate the degree to which trade policy uncertainty (TPU) at the industry-country-year level affects the global trade flows of major importers and exporters (e.g., the U.S., Canada, China, Mexico, and the European Union). Similarly, we construct the U.S. index of economic uncertainty at the industry-year level to investigate its effects on U.S. wages. In the first essay, we use a text-mining approach to construct a general index of trade policy uncertainty (TPU) for the U.S. and some of its main trade partners. This TPU index captures uncertainty on U.S. trade policy at a very detailed level (partner and industry levels) from 2001 to 2017 based on US trade-related news information. It's general, thereby enabling us to control for uncertainty relative to the use of highly-regulated tariff barriers under the WTO, temporary trade barriers (TTB), export restrictions, and potential reinterpretations of trade-related national security concerns, among others. Results suggest that a one-standard-deviation increase in policy uncertainty tends to decrease U.S. imports by 1.14 percent. In contrast, uncertainty on the trade policy applied by U.S. trade partners tends to reduce U.S. exports only to markets where the importers display a significant market power level. The results also show that the effects of trade policy uncertainty are mitigated with the formation of preferential trade arrangements (PTAs). In the second essay, motivated by the important findings of U.S. TPU effects on U.S. trade flows, we extend the study to another four markets, namely, Canada, Mexico, China, and the European Union, and their trade partners. We construct a TPU index for each of these four markets based on their news information using the same method applied to the first essay. Again, this TPU index captures uncertainty on the trade policies of these four markets at the importer-exporter-industry level from 2001 to 2017. The primary findings of the second essay are very much in line with the previous results. Uncertainty on the trade policy implemented by Canada, Mexico, China, and the EU tends to lower their imports. Specifically, a one-standard-deviation increase in policy uncertainty is associated with a decline of 0.71 percent in their imports. Moreover, uncertainty on the trade policy applied by the trade partners of these four groups is more likely to reduce their exports. Specifically, a one-standard-deviation increase in TPU leads to a decline of 0.62 percent in these four markets' exports. The impact of trade policy uncertainty on imports and exports for each of the four markets is also negative. In addition, PTAs tend to mitigate the negative effect of trade uncertainties on these four markets' trade flows. In the third essay, we study the reaction of the labor market to the economic uncertainty in the U.S. We specifically construct the U.S. economic uncertainty index with the same method we used to create the TPU in the previous two chapters on wages. The economic uncertainty index is generated based on U.S. economic-related news information that captures uncertainty on U.S. economic events and policies at the industry level from 2001 to 2018. Interestingly, the increase in economic uncertainty is likely to reduce wages in the U.S. labor market. Our result shows that the total effects of the concurrent and lagged economic uncertainty indexes cause a decline in wages by 2.12 percent. We also get plausible results by constructing alternative U.S. economic uncertainty indices using 1) newspapers released by other countries and 2) other countries' economic uncertainty indexes as instruments.
Author: Erhan Artuc
Publisher: World Bank Publications
ISBN: 1464812497
Category : Business & Economics
Languages : en
Pages : 215
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South Asia has grown rapidly with significant reductions in poverty, but it has not been able to match the fast-growing working age population, leading to lingering concerns about jobless growth and poor job quality. Could export growth in South Asia result in better labor market outcomes? The answer is yes, according to our study, which rigorously estimates—using a new methodology—the potential impact from higher South Asian exports per worker on wages and employment over a 10-year period. Our study shows the positive side of trade. It finds that increasing exports per worker would result in higher wages—mainly for better-off groups, like more educated workers, males, and more-experienced workers—although less-skilled workers would see the largest reduction in informality. How can the benefits be spread more widely? Our study suggests that scaling up exports in labor-intensive industries could significantly lower informality for groups like rural and less-educated workers in the region. Also, increasing skills, and participation of women and young workers in the labor force could make an even bigger dent in informal employment. The region could achieve these gains by: (i) boosting and connecting exports to people (e.g., removing trade barriers and investment in infrastructure); (ii) eliminating distortions in production (e.g., by more efficient allocation of inputs); and (iii) protecting workers (e.g., by investing in education and skills).
Author: Chan Yu
Publisher:
ISBN:
Category :
Languages : en
Pages : 288
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The first two chapters of the dissertation study how local labor market adjusts to trade shocks. The last chapter explores the relationship between economic condition change and health outcomes. In what follows, I describe my three essays. The first chapter proposes a mechanism through which local labor markets adjust to trade shocks: immigrants’ mobility. I find that immigrants are more responsive than natives to trade shocks. A $1000 increase in the import exposure leads to a 2.6 percent decline in the immigrant population but has little change in the native population. Additionally, immigrant mobility reduces the negative effects of trade shocks on native employment and wages. The study ultimately shows that natives in areas with more immigrants experience smaller declines in employment and wages. The second chapter studies the disparate impacts of trade liberalization on U.S. workers according to gender and age. Focusing on US-China trade shocks that occurred between 1990-2007, I show that these trade shocks generated larger declines in manufacturing employment and wages for older women than for older men. In contrast to prior studies, I find that discrimination and gender differences in industrial employment play relatively small roles in explaining this pattern. Instead, I present evidence that women's career interruptions from marriage and motherhood provide a more promising explanation. Within an age cohort, trade shocks depress labor market outcomes more strongly for married women with children than their male counterparts. The last chapter estimates the impact on infant birth outcomes of the farm credit crisis that hit the U.S. Midwest in the 1980s. Exploiting county-level variation in agricultural loans before the crisis, I use a difference-in-differences methodology to show that counties with more pre-existing farmland loans (per acre) experienced relatively worse infant health outcomes as the crisis unfolded. My estimates indicate that a $100 dollar increase in farmland loan (per acre) increased the incidence of low birth weight by around 0.4 percentage points and reduced the birth weight by 19 grams. Other findings show that the credit crisis intensified financial distress and tightened financial constraints for affected households, economic pressures that potentially provide a mechanism for the impact on birth outcomes. Counties that had purchased more farmland prior to the crisis suffered larger declines in their farm earnings, higher delinquency rates, and more bank failures
Author: Moises Yi
Publisher:
ISBN:
Category :
Languages : en
Pages : 128
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This dissertation employs tools from Labor Economics and International Trade to study how workers and labor markets adjust to economic shocks arising from trade liberalization and technological change. It contributes to the existing literature by studying several economic mechanisms that determine the magnitudes of these adjustments. The first chapter of this dissertation analyzes the roles that skill transferability and the local industry mix have on the adjustment costs of workers affected by negative trade shocks. Using rich administrative data from Germany, we construct novel measures of economic distance between sectors based on the notion of skill transferability. We combine these distance measures with sectoral employment shares in German regions to construct an index of labor market flexibility. This index captures the degree to which workers from a particular industry will be able to reallocate into other jobs. We then study the role of labor market flexibility on the effect of import shocks on the earnings and the employment outcomes of German manufacturing workers. Among workers living in inflexible labor markets, the difference between a worker at the 75th percentile of industry import exposure and one at the 25th percentile of exposure amounts to an earnings loss of roughly 11% of initial annual income (over a 10 year period). The earning losses of workers living in flexible regions are negligible. These findings are robust to controlling for a wide array of region level characteristics, including region size and overall employment growth. Our findings indicate that the industry composition of local labor markets plays an important role on the adjustment processes of workers. In the second chapter, we develop and apply a framework to quantify the effect of trade on aggregate welfare as well as the distribution of this aggregate effect across different groups of workers. The framework combines a multi-sector gravity model of trade with a Roy-type model of the allocation of workers across sectors. By opening to trade, a country gains in the aggregate by specializing according to its comparative advantage, but the distribution of these gains is unequal as labor demand increases (decreases) for groups of workers specialized in export-oriented (import-oriented) sectors. The model generalizes the specific-factors intuition to a setting with labor reallocation, while maintaining analytical tractability for any number of groups and countries. Our new notion of "inequality-adjusted" welfare effect of trade captures the full cross-group distribution of welfare changes in one measure, as the counterfactual scenario is evaluated by a risk-averse agent behind the veil of ignorance regarding the group to which she belongs. The quantitative application uses trade and labor allocation data across regions in Germany to compute the aggregate and distributional effects of a shock to trade costs or foreign technology levels. For the extreme case in which the country moves back to autarky we find that inequality-adjusted gains from trade are larger than the aggregate gains for both countries, as between-group inequality falls with trade relative to autarky, but the opposite happens for the shock in which China expands in the world economy. In the third chapter, we use detailed production data from a large Latin American garment manufacturer to study the process of technology adoption and resulting productivity changes within a firm. We find that the adoption of modern manufacturing techniques increases productivity through two channels, a direct effect and a spillover effect across adjacent production units. By exploiting the gradual introduction of new manufacturing techniques across independent production units, we estimate a direct effect on productivity of roughly 30%. We also estimate large spillovers to neighboring untreated units which amount to a 25% increase in productivity. Both of these effects accumulate slowly over time. The timing and the magnitudes of the estimated spillover effects corroborate qualitative evidence consistent with knowledge diffusion, learning and imitation.
Author: Raymond Eugene Robertson
Publisher:
ISBN:
Category : Free trade
Languages : en
Pages : 148
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Author: Alexander Wickman Bartik
Publisher:
ISBN:
Category :
Languages : en
Pages : 289
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This thesis consists of three chapters on the economics of labor markets. Each chapter explores an aspect of the distributional consequences of labor market shocks due to changes in trade, regulations, or technology. The first chapter investigates the extent to which geographic variation in wage growth reflects workers' incomplete arbitrage of changing job opportunities in different locations, industries, and occupations. Without moving costs, worker adjustment to changes in labor demand would eliminate differential earnings effects between directly exposed workers and others in the same skill group. I find evidence against this full-mobility benchmark, estimating that exposure to trade with China reduces earnings of non-college educated workers in exposed Commuting Zones (CZs) by 4%, and fracking increases earnings of the original residents of exposed CZs by 7%. I estimate a model of location, sector, and occupation choice to quantify the costs that rationalize this incomplete arbitrage. Simulations show that halving these moving costs would have reduced the effect of exposure to trade with China by 35%. In the second chapter, Scott Nelson and I study recent bans on employers' use of credit reports to screen job applicants. Exploiting geographic, temporal, and job-level variation in which workers are covered by these bans, we find that the bans reduced job-finding rates for blacks by 7 to 16 log points, and increased separation rates for black new hires by 3 percentage points. We interpret these findings in a statistical discrimination model in which credit report data provides employers with a higher precision signal of workers' skills, compared to employers' prior beliefs and knowledge about workers' skills; this signal has particularly strong effects on blacks' employment outcomes. In the third chapter, Janet Currie, Christopher Knittel, Michael Greenstone, and I investigate the local welfare consequences of hydraulic fracturing. Exploiting geological and temporal variation, we find that allowing fracking leads to improvements in a wide set of economic indicators. At the same time, estimated willingness-to-pay (WTP) for the decrease in local amenities is equal to $1000 to $1,600 per household annually. Overall, we estimate that the WTP for allowing fracking equals $1,300 to $1,900 per household annually.
