2018年-世界发展银行全球_Impact_of_US_Market_Access_on_Local_Labor_Markets_in_Vietnam_44页_1mb

Summary of "Impact of U.S. Market Access on Local Labor Markets in Vietnam"

Core Content

This paper investigates the impact of the U.S.-Vietnam Bilateral Trade Agreement (BTA), which came into effect in December 2001, on local labor markets in Vietnam. The study highlights the labor market effects of U.S. market access, focusing on the spillover effects from manufacturing to other sectors, particularly services, and the reallocation of labor from agriculture to non-farm sectors.

Main Findings

• U.S. Market Access and Employment Growth: Provinces in Vietnam that were more exposed to U.S. tariff cuts experienced a significant increase in manufacturing employment between 2001 and 2003. These job gains also had positive spillover effects on service sectors, with employment in services increasing due to higher demand.

• Labor Reallocation: The growth in manufacturing and service employment attracted labor from the agricultural sector, resulting in a decline in agricultural employment. However, agricultural income per capita did not fall, suggesting increased productivity in agriculture due to labor reallocation.

• Income Effects: Non-farm income per capita increased significantly, contributing to overall household income growth in provinces with greater exposure to U.S. market access.

• Channels of Spillover: The paper explores three channels through which U.S. market access affects local labor markets:

  1. Demand Channel: The most significant, as increased manufacturing employment leads to higher demand for local services.
  2. Production Channel: Manufacturing firms expand production, creating more jobs.
  3. Real Estate Channel: The growth in business opportunities leads to a real estate boom, creating construction and related jobs.

Key Information

• Data Sources: The study uses two waves of the Vietnam Household Living Standards Surveys (VHLSS) from 2002 and 2004, which provide detailed information on household employment, income, and other characteristics.

• Methodology: The researchers employed a panel data approach, using changes in the share of employed household members and working hours across sectors. They controlled for pre-existing household and provincial characteristics to isolate the effects of the BTA.

• Provincial Tariff Reductions: The measure of provincial tariff cuts was calculated as a weighted sum of tariff reductions based on the share of workers in each industry and the change in tariffs due to the BTA. The average provincial tariff cut was 8.6%, with Ho Chi Minh City experiencing the largest reduction (-15.1%) and Quang Ninh the smallest (-6.6%).

• Sectoral Employment Changes:

  • Agriculture: A 10% decrease in provincial tariffs led to a 16% decline in the share of agricultural employment.
  • Manufacturing: A 10% decrease in tariffs led to a 12% increase in the share of manufacturing employment.
  • Services: A 10% decrease in tariffs led to a 7% increase in the share of service employment.

• Working Hours: The share of working hours in manufacturing and services also increased, indicating that labor was being utilized more efficiently, with less underemployment.

Structural Transformation

The study finds evidence of structural transformation in Vietnam’s labor markets, where labor shifts from agriculture to manufacturing and services. This shift is attributed to the opening of the U.S. market, which led to increased demand and production in export-oriented industries, and consequently, to the creation of new jobs in the service sector.

Policy Implications

The findings suggest that trade agreements can have significant positive effects on local labor markets, especially in developing countries like Vietnam. The results highlight the importance of considering spillover effects when evaluating trade impacts, as these can lead to broader economic benefits beyond the immediate export sectors.

Conclusion

The U.S. market access, through the BTA, provided a "kick" to Vietnamese provinces that were more exposed to U.S. tariff cuts. This led to increased employment and income in manufacturing and services, with a reallocation of labor from agriculture. The demand channel was found to be the most important mechanism driving these changes. The paper contributes to the growing body of literature on trade's labor market effects, offering insights from the perspective of an exporting country.