The Impact of Trade Liberalization on Employment, Capital and Productivity Dynamics: Evidence from the Uruguayan Manufacturing Sector (2004)

42 Pages Posted: 13 Sep 2006

See all articles by Nestor Gandelman

Nestor Gandelman

Universidad ORT Uruguay

Carlos Casacuberta

Universidad ORT at Uruguay - Department of Economics

Gabriela Fachola

Universidad ORT at Uruguay

Abstract

This paper studies the impact of trade liberalization on labor and capital gross flows and productivity in the Uruguayan manufacturing sector. Uruguay opened its economy in the presence of—at least initially-strong unions and structurally different industry concentration levels. Higher international exposure implied slightly higher job creation and an important increase in job and capital destruction. Unions were able to dampen this effect. Although not associated with higher creation rates, unions were effective in reducing job and capital destruction. Industry concentration also was found to mitigate the destruction of jobs but had no effect on job creation or capital dynamics.

Keywords: trade liberalization, employment and capital reallocation, TFP, Latin-America, Uruguay

Suggested Citation

Gandelman, Nestor and Casacuberta, Carlos and Fachola, Gabriela, The Impact of Trade Liberalization on Employment, Capital and Productivity Dynamics: Evidence from the Uruguayan Manufacturing Sector (2004). Journal of Policy Reform, Vol. 7, No. 4, pp. 225-248, 2004, Available at SSRN: https://ssrn.com/abstract=929186

Nestor Gandelman (Contact Author)

Universidad ORT Uruguay ( email )

Bulevar España 2633
Montevideo, 11.300
Uruguay

Carlos Casacuberta

Universidad ORT at Uruguay - Department of Economics ( email )

Bulevar Espana 2633
Montevideo, 11300
Uruguay

Gabriela Fachola

Universidad ORT at Uruguay ( email )

Bvar. Espana 2633
Montevideo

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