Job creation, job destruction, and the real exchange rate

Michael Klein, Scott Schuh and Robert Triest

No 99-11, Working Papers from Federal Reserve Bank of Boston

Abstract: This paper contributes to an understanding of internationally generated adjustment costs by demonstrating a statistically significant and economically relevant effect of the real exchange rate on job creation and job destruction in U.S. manufacturing industries over the period 1973 to 1993. The responsiveness of these gross job flows to the real exchange rate reflects pervasive heterogeneity with respect to international conditions across firms, even within narrowly defined industries. We document this heterogeneity and show that the responsiveness of job flows to movements in the real exchange rate varies with the industry's openness to international trade. We also show an asymmetry in the responsiveness of job flows to the real exchange rate; appreciations play a significant role in job destruction, but job flows do not respond significantly to dollar depreciations.

Keywords: Job analysis; Labor market (search for similar items in EconPapers)
Date: 1999
New Economics Papers: this item is included in nep-lab
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Related works:
Journal Article: Job creation, job destruction, and the real exchange rate (2003)
Working Paper: Job Creation, Job Destruction, and the Real Exchange Rate (2000)
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