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Import competition and local labor markets: the case of Indonesia

Fina Sri Agustina ()
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Fina Sri Agustina: Department of Economics, Universitas Indonesia, Jakarta, Indonesia

Economic Journal of Emerging Markets, 2018, vol. 10, issue 2, 177-186

Abstract: This paper analyzes the effects of import competition on Indonesian local labor markets in term of manufacturing employment share, non-manufacturing employment share, unemployment rate, and wages. A rapid increase in globalization has caused many countries including Indonesia experiences a significant increase in imports, which leads to tougher import competition. Using data of imports from 430 districts in Indonesia in the period of 2007-2013, we find that import competition has negatively affected manufacturing employment share, non-manufacturing employment share, and wages. It also increases unemployment. Besides, the highest impact is mainly driven by imports of consumption goods.

Keywords: import competition; local labor market; Indonesia (search for similar items in EconPapers)
JEL-codes: F66 J21 J40 (search for similar items in EconPapers)
Date: 2018
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DOI: 10.20885/ejem.vol10.iss2.art6

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Handle: RePEc:uii:journl:v:10:y:2018:i:2:p:177-186