EconPapers    
Economics at your fingertips  
 

Labor Market Adjustment to Third Party Competition: Evidence from Mexico

Raymond Robertson, Timothy Halliday and Sindhu Vasireddy ()

No 12002, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: China's exports reduce wages in importing countries, but few studies have looked at competition in third party markets. We examine labor market outcomes in Mexico's apparel and textile sectors associated with U.S. apparel and textile imports from China. Using data on U.S. imports in conjunction with quarterly Mexican labor force surveys, we show that U.S. imports from China are associated with a reduction of employment in Mexico's textile and apparel sectors. These effects are the most pronounced for the least educated. Wages were not impacted on net except for the poorest indicating stronger local labor market ties in the left tail of the wage distribution. Notably, reductions in labor demand due to reduced textile imports had spill-overs beyond these sectors. Finally, the effects of trade-induced demand shocks dissipate after about two quarters indicating low firm-level adjustment costs.

Keywords: apparel; China; Mexico; trade; wages; inequality (search for similar items in EconPapers)
JEL-codes: F16 J31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cna and nep-lma
Date: 2018-11
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://ftp.iza.org/dp12002.pdf (application/pdf)

Related works:
Working Paper: Labor Market Adjustment to Third Party Competition: Evidence from Mexico (2018) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp12002

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().

 
Page updated 2019-11-19
Handle: RePEc:iza:izadps:dp12002