Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy

A. Kerem Coşar, Nezih Guner and James Tybout

No 7718, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, and wage distributions. It uses establishment-level data from Colombia to estimate an open economy dynamic model that links trade to job flows in a new way. The fitted model captures key features of Colombian firm dynamics and labor market outcomes, as well changes in these features during the past 25 years. Counterfactual experiments imply that integration with global product markets has increased both average income and job turnover in Colombia. In contrast, the experiments find little role for this country's labor market reforms in driving these variables. The results speak more generally to the effects of globalization on labor markets in Latin America and elsewhere.

Keywords: size distribution; firm dynamics; international trade; labor market frictions; inequality (search for similar items in EconPapers)
JEL-codes: E24 F12 F16 J64 L11 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2013-11
New Economics Papers: this item is included in nep-bec, nep-dge, nep-ifn, nep-lab, nep-ltv and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Published - published in: American Economic Review, 2016, 106 (3), 625-63.

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Related works:
Journal Article: Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy (2016)
Working Paper: Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy (2015)
Working Paper: Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy (2013)
Working Paper: Firm dynamics, job turnover, and wage distributions in an open economy (2011)
Working Paper: Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy (2010)
Working Paper: Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy (2009)
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