Labour productivity and international trade

University dissertation from Örebro : Örebro universitetsbibliotek

Abstract: The aims of the four treatises contained in here are to investigate the determinants of export (and FDI) and possible impacts of international trade on labour productivity, labour demand and inter-industry wage premiums.Paper [1] uses shift-share method and augmented production function-approach. This research investigates the determinants of the growth of labour productivity in the manufacturing sector. The research is based on a three-digit level set of data for 170 industries from the manufacturing sector of Guangdong province, China, for periods 1995-1997 and 1998-2001. The result of this research suggests that reallocation of work-force across industries play a minor role in the growth of aggregate productivity. It shows that growth of productivity could be attributed to accumulation of physical and human capital. There is evidence to the existence of productivity effect of market oriented reforms. Further, it suggests that overall effects of export and FDI (for the full sample with outliers) on productivity depend on the level of industry concentration.Paper [2] investigates of the determinants of export intensity and of FDI presence among the manufacturing industries from the Guangdong Province of China. The study is based on a three-digit level set of panel data collected for 1998-2002 from 158 manufacturing industries. The results indicate that export-intensity and FDI-presence are high in industries with low physical capital intensity, low labour costs and low R&D intensity. Industries with less state-participation (or high FDI-presence) are likely to enjoy comparatively high levels of export-intensity. They indicate further that the FDI emanating from non-dragon economies (those other than Hong Kong, Macao and Taiwan) and low labour costs are fundamental and foremost for sustained export performance.Paper [3] investigates the effects of trade and innovation via technical progress on employment in a dynamic framework, based on a panel of Swedish manufacturing firms in the 1990s. The main results show that the employment effect of sales is positive whilst the effect of firms’ own wage is negative. The firms’ exports do not necessarily induce labour saving technical progress instead they induce capital-saving technical progress which leads to creation of jobs. The effects of R&D intensity (or R&D expenditure) via technical progress on employment are positive at the firm level.Paper [4] (co-authored with Nannan Lundin) examines the inter-industry wage structure in Swedish manufacturing by using matched employer-employee data for the period 1996 to 2000. First, we use detailed individual and job characteristics to estimate industry-specific and time-varying wage premiums. Second, we investigate the impact of international trade on wage premiums, after controlling for effects of domestic competition and technical progress. Our results indicate that industries that face intensive import competition from low-income countries have lower wage premiums. Surprisingly, the wage premiums are not related to export intensities. Furthermore, technical progress, measured by investment in R&D activity, appears to enhance inter-industry wage premiums.

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