Trade and Labor Standards in the European Union: A Gravity Model Approach

Yiagadeesen Samy () and Vivek Dehejia ()
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Yiagadeesen Samy: The Norman Patterson School of International Affairs

No 08-08, Carleton Economic Papers from Carleton University, Department of Economics

Abstract: Using a gravity model, we examine whether labor standards are important determinants of bilateral export performance for EU-15 countries over the period 1988-2001. We assess the conventional wisdom that countries with low labor standards and less stringent regulations have performed better in terms of trade performance and use a panel data set in a triple-indexed gravity model to conduct our empirical investigation. Our empirical results indicate that labor standards matter, but that the conventional wisdom does not always hold. The standard variables used in gravity equations conform to theoretical expectations and are highly significant.

Keywords: international trade; labor standards; gravity equation (search for similar items in EconPapers)
JEL-codes: F13 F14 F15 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2008-10-28
New Economics Papers: this item is included in nep-eec, nep-int and nep-lab
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Citations: View citations in EconPapers (4)

Published: Carleton Economic Papers

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Persistent link: https://EconPapers.repec.org/RePEc:car:carecp:08-08

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