Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/289975 
Year of Publication: 
2023
Series/Report no.: 
IDB Working Paper Series No. IDB-WP-1418
Publisher: 
Inter-American Development Bank (IDB), Washington, DC
Abstract: 
By exploiting spatial variation in import exposure arising from initial differences in industry specialization, we analyze how local labor markets in Mexico adjusted to increased Chinese-import competition over different time horizons. The initial adjustment to the shock took various forms: a decline in the number of wage employees, a substitution of wage employees with piece-rate or outsourced workers, and a substitution of formal employees with informal employees. The negative effects on employment were mainly associated with job destruction from exiting firms, particularly those that were small and medium-sized. During periods in which employment fell, the population that actively participated in the labor force fell. The negative short- and medium-run effects mostly disappeared after 20 years.
Subjects: 
Import competition
Local labor markets
Employment
Mexico
JEL: 
F14
F16
J23
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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