Globalization of Labour Markets: Challenges, Adjustment and Policy Response in the EU and LDCs

345 Pages·1997·27.76 MB·English

by  Olga Memedovic

Globalization of labour markets
EU-LDC Trade and Capital Relations Series
The EU-LDC Trade and Capital Relations Series publishes the proceedings
of the EU-LDC Trade and Capital Relations Network's annual workshops.
Thanks to a grant from the Netherlands Ministry of Foreign Affairs, the
Network was established at the Netherlands Economic Institute to monitor
relations between the European Union and less developed countries. The
activities of the Network include: (i) publication of a quarterly newsletter
EU-LDC News which highlights recent developments; (ii) workshops which
focus on strategic issues and (iii) publication of the workshops' proceedings.
The activities of the Network are managed by a Network Team and
supervised by a Steering Committee.
Steering Committee
Chairman
Rolf Langhammer
Michael Green
K. Ad Koekkoek
Arie Kuyvenhoven
Patricio Meller
Patrick A. Messerlin
Willem T. M. Molle
H.M.A. Onitri
Christopher Stevens
Secretary
Nico van der Windt
Network Team at the Netherlands Economic Institute
Olga Memedovic
Marrie de Kreek
Globalization of Labour Markets
Challenges, Adjustment and Policy Response
in the EU and LDCs
Edited by
OLGA MEMEDOVIC
ARIE KUYVENHOVEN
and
WILLEM T. M. MOLLE
.....
"
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Library of Congress Cataloging-in-Publication Data
Globalization oflabour markets: challenges, adjustment, and policy
response in the EU and LCD's / edited by Olga Memedovic, Arie
Kuyvenhoven, and Willem T.M. Molle.
p. cm.
Articles resulting from a workshop held in Rotterdam in 1995.
Includes bibliographical references and index.
ISBN 0-7923-9986-2
I. Labor market--Congresses. 2. Labor market--European Union
countries--Congresses. 3. Labor market--Developing countries-
-Congresses. 4. International division oflabor--Congresses.
5. Foreign trade and employment--Congresses. 6. Alien labor-
-Congresses. 7. Emigration and immigration--Congresses.
I. Memedovic, Olga. II. Kuyvenhoven, Arie. III. Molle, Willem.
HD5701.3.G584 1997
331.12--dc21 97-33607
CIP
Copyright © 1998 by Kluwer Academic Publishers
All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system or transmitted in any form or by any means, mechanical, photo
copying, recording, or otherwise, without the prior written permission of the
publisher, Kluwer Academic Publishers, 101 Philip Drive, Assinippi Park, Norwell,
Massachusetts 02061
Printed on acid-free paper.
Contents
page
List offigures lX
List of tables Xl
Preface XV
Foreword Bernard S.M Berendsen xv 11
Acknowledgements XXI
List of contributors XXlll
PART ONE: OVERVIEW
1 Introduction and summary 3
Olga Memedovic, Arie Kuyvenhoven
and Willem TM Molle
1 Introduction 3
2 Theoretical issues 8
3 Exporting goods or labour 14
4 Policy response 20
PART TWO: THEORETICAL ISSUES
2 Trade and wages: a malign relationship? 31
Jagdish N Bhagwati
1 Introduction 31
2 Clarifications and caveats 32
3 Alternative theoretical approaches 35
4 Concluding thoughts 56
Discussion 66
Martin Wolf
Zhang Xiaoji
Adrian Wood
VI
3 Looking South and East: labour market implications of
migration in Europe and LDCs 75
Thomas Bauer and Klaus F. Zimmermann
1 Introduction 75
2 Some stylized facts 76
3 Theoretical framework 86
4 Calculating the gains from immigration for
the destination country 91
5 Conclusions 97
Discussion 103
Andre Sapir
Ruth Klinov
4 Locational innovation in LDC investment and
its implications for migration: foreign direct
investment in and by LDCs 111
Sheila Page
1 Introduction 111
2 New sources and directions 112
3 Reasons for investing 1 19
4 Why do countries want FDI? 122
5 Do the traditional explanations still work? 123
6 Multinationals and trade 126
7 Differences among foreign investors 13 1
8 Prospects for FDI 132
Discussion 135
Sartaj Aziz
Marcel F. van Marion
PART THREE: EXPORTING GOODS OR LABOUR
5 Exporting goods or labour: experiences of East,
South and South-East Asia 153
Florian A. A/huro
1 Introduction: explosion of labour exports 153
2 Goods exports or labour exports? 157
3 Trade and turning-points 162
4 Conclusion 168
Discussion 172
Alutwala D. V. de S. Indraratna
Morris Teubal
VII
6 Trade and employment in Latin America 183
Patricio Meller
1 Introduction 183
2 Review of the employment-trade relationship 184
3 The pattern of Latin American trade 187
4 Estimation of the employment effects of
Latin American trade in manufactures 191
5 Changes in employment in the Chilean and
Mexican manufacturing sector 199
Discussion 203
Karsten Nimh Pedersen
Alfred Tovias
7 Exporting goods or labour: the experience of North
and Sub-Saharan Africa 213
Festus 0. Fajana
1 Introduction 213
2 North and Sub-Saharan Africa's experience
with exporting goods to Europe 214
3 Migration of labour from North and
Sub-Saharan Africa to Europe 218
4 Prospects and the way out 223
Discussion 227
Giuseppe Gesano
PART FOUR: POLICY RESPONSE
8 Labour in the global economy: challenges,
adjustment and policy response in the EU 237
Gijshert van Liemt
1 Introduction 237
2 The social dimension of globalization 239
3 The social dimension of the European integration 242
4 Conclusion 248
Discussion 251
Raymond Torres
viii
9 Labour market integration and policy response in
East and South-East Asia 257
Suthiphand Chirathivat
1 Overview 257
2 Broad conceptual background 258
3 Recent experiences of labour mobility in ESEA 259
4 Labour market integration in the context of
regional economic integration 261
5 Further steps for regional policy 267
6 Conclusion 272
Discussion 275
Jose Antonio Ocampo Gaviria
Maria del Carmen Pont-Vieira
10 Technological progress, innovation and employment in
Latin America: the 1990s 283
Jorge Katz
Jose Miguel Benavente
1 Introduction 283
2 'Old' and 'new' theoretical questions 286
3 A non-orthodox account of the Latin American
industrialization process 288
4 Industrial strategy and public policy in the 1990s 296
Discussion 303
Adell Gazarin
Ludovico Alcorta
Index 313
Figures
page
2.1 The impact of trade deficit/surplus on the real wages of
production factors 34
2.2 Increase in trade between the North and the South due to the
trade liberalization in the South 36
2.3 Increase in trade between the North and the South due to
the trade liberalization in the North 37
2.4 Stolper-Samuelson relationship between the goods prices
and the real wage of unskilled labour and Samuelson
relationship between goods prices and factor prices. 39
2.5 Changes in the real wage of unskilled labour for different
goods price-ratios under autarky 42
2.6 Changes in the real wage of unskilled labour for
different goods' price ratios under free trade and
autarky 43
2.7 The impact of import increase of Apparel on
the domestic price and production 46
2.8 Hicks-neutral technical change effect on the output in
Machinery and Apparel 47
2.9 Effects of the Hicks-neutral technical change in
Machinery on the relative wage of skilled labour 49
3.1 Unemployment rate and the share of foreign population in
the EU Member States, the United States and Japan, 1991 81
3.2 Population growth (1994-2025) and share of
foreign population (1991) in the EU Member States,
the United States and Japan 82
3.3 Population pressure and economic development in
countries of North Africa, the CEECs and the EU, 1991 83
3.4 South-North (unskilled) migration 88
3.5 East-West (skilled) migration 90
3.6 Immigration gain of native workers and immigrant
skills with different extents of immigration 92
x
3.7 Immigration gain of native workers according to
production factors 95
5.1 Ratio of merchandise exports to remittances in Asian
countries, 1980-93 165
5.2 Annual changes in the value of exports in South Korea,
Thailand and the Philippines, 1980-93 166
5.3 Annual changes in the number of migrant workers in South
Korea, Thailand and the Philippines, 1976-93 168