Trade Liberalization, Employment Flows, and Wage Inequality in Brazil

Using nationally representative, economywide data, this paper investigates the relative importance of trade-mandated effects on industry wage premia; industry and economywide skill premia; and employment flows in accounting for changes in the wage distribution in Brazil during the 1988-95 trade liberalization. Unlike in other Latin American countries, trade liberalization appears to have made a significant contribution toward a reduction in wage inequality. These effects have not occurred through changes in industry-specific (wage or skill) premia. Instead, they appear to have been channeled through substantial employment flows across sectors and formality categories. Changes in the economywide skill premium are also important.

Bibliographic Details

Main Authors:	Leite, Phillippe G., Ferreira, Francisco H.G., Wai-Poi, Matthew
Language:	English
Published:	World Bank, Washington, DC 2007-01
Subjects:	AGGREGATE TRADE, AGRICULTURE, BENCHMARK, COMPETITIVE CONDITIONS, COMPETITIVE MARKETS, COMPETITIVE PRESSURES, CONSUMERS, COUNTERFACTUAL WAGE DISTRIBUTION, CUSTOMS, DEVELOPING REGIONS, DOMESTIC PRICES, DOMESTIC PRODUCTION, EARNINGS REGRESSIONS, EMPLOYMENT EFFECTS, EMPLOYMENT LEVELS, EMPLOYMENT PROBABILITIES, EMPLOYMENT SHARE, EXCHANGE RATE, EXCHANGE RATES, EXPORT SHARES, EXPORTERS, FACTORS OF PRODUCTION, GROUP WORKERS, GROWTH RATE, HOUSEHOLD INCOME, HOUSEHOLD SURVEY, IMPACT OF TRADE, IMPACT OF TRADE LIBERALIZATION, IMPERFECT COMPETITION, IMPORT COMPETITION, IMPORT PENETRATION, IMPORTS, INCOME LEVELS, INDUSTRY CHARACTERISTICS, INDUSTRY WAGE, INEQUALITY MEASURES, INFORMAL EMPLOYMENT, INFORMAL SECTOR, INTERNATIONAL TRADING SYSTEM, LABOR FORCE, LABOR MARKET, LABOR MARKETS, LABOR REALLOCATION, LATIN AMERICAN, MARGINAL EFFECTS, NATURAL RESOURCES, NON-TARIFF BARRIERS, OCCUPATION, OCCUPATIONS, OPENNESS, OUTSOURCING, PER CAPITA INCOMES, POLICY MAKERS, POLICY RESEARCH, PREVIOUS STUDIES, PRICES FALL, PRODUCT MARKETS, PRODUCT PRICES, PRODUCTION WORKERS, PROTECTED INDUSTRIES, PUBLIC SERVICE, RATES OF PROTECTION, RURAL WORKERS, SKILL PREMIUM, TARIFF BARRIERS, TARIFF RATES, TARIFF REVENUES, TOTAL EMPLOYMENT, TOTAL FACTOR PRODUCTIVITY, TOTAL FACTOR PRODUCTIVITY GROWTH, TRADE DATA, TRADE FLOWS, TRADE LIBERALIZATION, TRADE LIBERALIZATIONS, TRADE MODELS, TRADE OPENNESS, TRADE POLICY, TRADE REFORM, TRADE REFORMS, TRADE VARIABLES, UNEMPLOYMENT, UNSKILLED LABOR, UNSKILLED WORKERS, WAGE DISTRIBUTION, WAGE GAP, WAGE GROWTH, WAGE INEQUALITY, WAGE LEVELS, WAGE PREMIUM, WAGES, WORKER, WORLD TRADE,
Online Access:	http://documents.worldbank.org/curated/en/2007/01/7309378/trade-liberalization-employment-flows-wage-inequality-brazil https://hdl.handle.net/10986/6880
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