Trade Adjustment Costs in Developing Countries: - World Bank ...

Trade Reform, Employment Allocation and Worker Flows 111industries have lower than average tariffs. Comparative-advantage industries alsoexhibit lower import penetration. Firms in the top comparative-advantageindustries and exporters have larger workforces than average (85 and 326 workersmore, respectively, than the average formal-sector manufacturing plant with 257workers). The sample from RAIS is a random draw of workers from the formalsector worker universe, so that larger plants are over-represented. Manufacturingemployment drops between 1990 and 1998, and drops faster than average in thehighest quintile advantage sectors.Table 7.3: RAIS summary statistics for manufacturingAll sectors and firms5th comp.adv. Quintile ExporterMean Std.Dev. Mean Mean(1) (2) (3) (4)OutcomesIndic.: Separation .282 .450 .314 .260Quit .026 .160 .031 .020Indic.: Accession .292 .455 .326 .237Main covariatesBalassa (1965) Comp. Adv. 1.450 1.047 3.223 1.373Exporter Status .495 .500 .439 1.000Product Market Tariff .193 .103 .174 .204Intm. Input Tariff .146 .077 .105 .154Import Penetration .064 .052 .031 .074Plant-level covariatesLog Employment 5.148 1.952 5.551 6.210Log Employment 1998/90 .930 .919 .976Log Labor Productivity 11.186 .706 11.081 11.233Log Labor Productivity 1998/90 1.045 1.025 1.047Sources: Menezes-Filho and Muendler (2007). RAIS 1990–98 (1-percent random estimation sample),male workers nationwide, 25 to 64 years old, with manufacturing job.Note: Statistics based on separation sample, except for accession indicator (146,787 observations inseparation, 112,974 in accession sample). Sector information at subsector IBGE level. PIA 1986–98for labor productivity information.To obtain labor productivity, a random extract and three-firm aggregate of themanufacturing firm survey PIA is used (see Appendix B). There are remarkablemean differences in labor productivity between an exporter and an average firm.A reason is that substantial employer heterogeneity prevails within industries,with diverse exporters and nonexporters having shifting mean characteristics.Labor productivity increases between 1990 and 1998. At exporters, laborproductivity is higher than average over the whole sample period, but lower thanaverage at firms in comparative-advantage industries. Log labor productivity in1998 exceeds log labor productivity in 1990 by 4.5 per cent in the estimationsample, and by 4.7 per cent at manufacturing exporters.