Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322435 
Year of Publication: 
2025
Series/Report no.: 
Document de travail No. 2025-02
Publisher: 
Université du Québec à Montréal, École des sciences de la gestion (ESG UQAM), Département des sciences économiques, Montréal
Abstract: 
The creation of stable and high-paying jobs by private firms is a first-order issue for Low-and-Medium Income Countries (LMICs). Little is known as to whether trade liberalization helps achieve this goal. In this study, we investigate the impact of the ASEAN-China Free Trade Agreement (ACFTA), signed in 2002, on the probability of being a wage-worker in Indonesia, a proxy for better-paid jobs in the Indonesian context. We find no evidence that import and export tariff reductions increased the probability of being a wage-worker, except for those that have more than primary education (less than a quarter of the working-age population). Consistent with this absence of effect at the worker level, we also find no significant changes in employment or value-added in large and medium-sized manufacturing firms, which are the main providers of salaried jobs. Our results call for cautious optimism regarding the potential gains in terms of job quality from further trade liberalization in LMICs, particularly in a global environment where tariffs are already low
Subjects: 
Trade liberalization
Salaried jobs
Informality
Manufacturing
JEL: 
F14
F16
O10
Document Type: 
Working Paper

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