On the Interaction between Trade Reforms and Labor Market Regulation: Evidence from the MENA Countries’ Labor Markets

Irene Selwaness and Chahir Zaki

No 27, GLO Discussion Paper Series from Global Labor Organization (GLO)

Abstract: Using a panel of MENA countries, this paper tries to examine the interaction between trade reforms and labor market regulations on the outcome of the labor market. The theoretical predictions on this literature show that the effects of trade liberalization in any given country are conditional on the nature of labor market regulations since trade liberalization is more likely to have a positive impact on employment and wages in countries with flexible labor markets and vice versa. Moreover, more regulated labor markets tend to have higher wages at the expense of sector wide employment. Our main findings show that labor market rigidity reduces the positive impact of trade reform on employment. While this result is stronger for females, it is not for males.

Keywords: Labor Market Rigidity; Trade; MENA (search for similar items in EconPapers)
JEL-codes: F14 F16 J08 J88 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-ara and nep-int
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https://www.econstor.eu/bitstream/10419/155753/1/GLO_DP_0027.pdf (application/pdf)

Related works:
Working Paper: On the Interaction Between Trade Reforms and Labor Market Regulation: Evidence from the MENA Countries' Labor Markets (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:glodps:27

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