Marginal Intra-industry Trade and Adjustment Costs in Labour Market

Nuno Carlos Leitão, Bogdan Dima and Dima (Cristea) Stefana
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Nuno Carlos Leitão: ESGTS, Polytechnic Institute of Santarém, CEFAGE, Évora University
Dima (Cristea) Stefana: Vasile Goldis Western University of Arad

No 2013.39, Working Papers from Fondazione Eni Enrico Mattei

Abstract: The objective of this study is to provide some empirical evidences on the existence of labor market adjustments according to smooth adjustment hypothesis (SAH) under the impact of intra-industry trade (IIT) considering the Portuguese case over a time span between 1995 and 2006. The main methodological issue of this study consists in showing that it is preferable to use the GMM-System approach with orthogonal transformation of data. The key outcome consists in highlighting a negative linkage between marginal intra-industry trade and the amplitude of employment changes for this particular market. In addition, we find a negative correlation between changes of employment and changes in domestic consumption. Moreover, the relationship between growth of productivity and market structure is according to smooth adjustment hypothesis.

Keywords: Intra-Industry Trade; Adjustment Costs; Portugal; Labour Market (search for similar items in EconPapers)
JEL-codes: C33 F12 (search for similar items in EconPapers)
Date: 2013-04
New Economics Papers: this item is included in nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2013.39

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