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Margins of labor market adjustment to trade

Dix-Carneiro, Rafael and Brian K. Kovak

Journal of International Economics, 2019, vol. 117, issue C, 125-142

Abstract: We use both longitudinal administrative data and cross-sectional household survey data to study the margins of labor market adjustment following Brazil's early 1990s trade liberalization. We document how workers and regional labor markets adjust to trade-induced changes in local labor demand, examining various adjustment margins, including earnings and wage changes; interregional migration; shifts between tradable and nontradable employment; and shifts between formal employment, informal employment, and non-employment. Our results provide insight into the regional labor market effects of trade, and have important implications for policies that address informal employment and that assist trade-displaced workers.

Keywords: Trade liberalization; Brazil; Employment; Earnings; Informal labor markets (search for similar items in EconPapers)
JEL-codes: F14 F16 J46 J61 (search for similar items in EconPapers)
Date: 2019
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