 Trade and employment in the formal and informal sectors: A natural experiment from CambodiaKiyoyasu Tanaka and Theresa Greaney Journal of Asian Economics, 2024, vol. 90, issue C Abstract: How does trade affect formal and informal jobs in developing economies? This paper estimates the impact of exports on employment in the formal and informal sectors by exploiting the European Union (EU)’s reform in rules of origin for duty-free market access, which produced a large positive shock to Cambodia’s garment exports to the EU. We use nationally representative datasets on formally registered and unregistered establishments in Cambodia for 2009, 2011, and 2014. The results show that the export shock caused large employment growth in formal garment establishments, but had little effect on employment in informal garment establishments. While the positive effect is pronounced for incumbent establishments and female workers, our estimates are not magnified by transitions between formal and informal status in the garment industry. Thus, trade promotes employment disproportionately in the formal sector. Keywords: Trade; Employment; Informal sector; GSP; Rules of origin; Cambodia (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:90:y:2024:i:c:s1049007823000969 DOI: 10.1016/j.asieco.2023.101676 Access Statistics for this article Journal of Asian Economics is currently edited by C. Wiemer More articles in Journal of Asian Economics from Elsevier |
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