Informal Jobs and Trade Liberalisation in Argentina

Acosta, Pablo ; Montes-Rojas, Gabriel

Taylor and Francis

关键词: trade liberalization;    labor markets;    informal labor;    formality;    trade competitiveness;   

DOI  :  10.1080/00220388.2014.919381

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Rapid trade liberalization can exert profound effects on labor markets. Domestic firms, to sustain competitiveness for survival, could react through cutting labor benefits to achieve cost reductions. Alternatively, trade liberalization may alter the industry composition of firms changing the aggregate formality rates. This paper studies the relationship between trade liberalization and informality in Argentina. Using manufacturing industry-level data for 1992-2003, the results confirm the hypothesis that trade increases informality in industries that experience sudden foreign competition. This explains about a third of the increase in informality. Sectors with higher investment ratios are able to neutralize and reverse this effect.