The Economic Effects of Labor Force Enhancement in the Asia-Pacific Region by Trade Liberalization

Hankyoung Sung ()
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Hankyoung Sung: University of Seoul

No 16-2, APEC Study Series from Korea Institute for International Economic Policy

Abstract: This paper uses the most recent Global Trade Analysis Project (GTAP) DB version 9 and a recursive dynamic computable general equilibrium model (CGE) to analyze the economic effect of enhancement in labor productivity that trade liberalization has in the APEC. In particular, unlike the previous studies that apply tariff reduction, this paper focuses on the changes in labor productivity reported by Ahn et al. (2016). The results show an increase in the real GDP of countries with gains in labor productivity. In particular, the results of this study indicate that the benefits of trade liberalization would be even larger for developed countries with a similar level of gains in labor productivity. It is also suggested that the efficiency of production structure or scale of economy may work for developed economies. In conclusion, this paper suggests another reason to pursue trade liberalization within in the APEC region.

Keywords: Labor Productivity; Dynamic CGE Model; Trade Liberalization; Real GDP (search for similar items in EconPapers)
Pages: 48 pages
Date: 2016-11-30
New Economics Papers: this item is included in nep-cmp, nep-eff, nep-int and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:ris:kiepas:2016_002

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