Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/2693
Authors: 
Spatz, Julius
Nunnenkamp, Peter
Year of Publication: 
2002
Series/Report no.: 
Kiel Working Paper 1093
Abstract: 
Even though the automobile industry is technologically advanced, the increasing integration of low-income countries into the global division of labor has put competitive pressure on traditional automobile producing countries. New end-producers emerged in Asia, Latin America as well as Southern and Central Europe. In addition, the automobile industries of Germany, Japan and the United States engaged in outsourcing of relatively labor intensive segments of the value chain, especially on a regional level. Our analysis of the labor market effects of these developments supports the predictions of trade models: Low-skilled workers and labor intensive subsectors of the automobile industry in traditional locations suffered deteriorating wage and employment prospects in the process of globalization. The adjustment to fiercer competition from below differed considerably between Germany, Japan and the United States. Economic restructuring was least pronounced in the US automobile industry, largely due to the resistance of trade unions. As a result, the employment record and the world-market performance of US automobile producers turned out to be poor compared to their German and Japanese counterparts.
Subjects: 
outsourcing
specialization profiles
revealed comparative advantages
relative wages
employment restructuring
Competitive pressure
outsourcing
specialization profiles
revealed comparative advantages
relative wages
employment restructuring
JEL: 
F14
L62
Document Type: 
Working Paper

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