Impact of Trade Policies on Manufacturing Sector Employment

Authors

  • Mac Nwende

DOI:

https://doi.org/10.47672/aje.1792

Keywords:

Trade, Policies, Manufacturing, Sector, Employment

Abstract

Purpose: The aim of the study was to assess the impact of trade policies on manufacturing sector employment.

Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries.

Findings: Several studies have investigated the impact of trade policies on manufacturing sector employment, yielding mixed findings. While some research suggests that trade liberalization leads to job losses in manufacturing due to increased competition from imports and outsourcing, others argue that it can stimulate employment by expanding markets and promoting specialization. Additionally, the effects vary across industries and regions, with certain sectors experiencing more significant displacement of workers than others. Factors such as the level of technology adoption, workforce skill levels, and government policies also play crucial roles in shaping the outcome.

Implications to Theory, Practice and Policy:  Heckscher-ohlin theory, stolper-samuelson theorem and ricardian model of comparative advantage may be use to anchor future studies on assessing the impact of trade policies on manufacturing sector employment. Foster collaboration between academia, industry, and government agencies to facilitate knowledge exchange and evidence-based decision-making. Advocate for the adoption of trade policies that prioritize job creation, wage growth, and labor standards while fostering competitiveness and innovation within the manufacturing sector.

Downloads

Download data is not yet available.

References

Ajakaiye, O., Olayiwola, K., & Adenikinju, A. (2021). Industrial clusters and employment generation in Nigeria: Evidence from the manufacturing sector. World Development, 140, 105327. DOI: 10.1016/j.worlddev.2020.105327

Autor, D. H., Dorn, D., Hanson, G. H., Majlesi, K., & Song, J. (2020). Importing political polarization? The electoral consequences of rising trade exposure. American Economic Review, 110(10), 3139-3183. DOI: 10.1257/aer.20190396

Autor, D. H., Dorn, D., Hanson, G. H., Majlesi, K., & Song, J. (2020). Importing political polarization? The electoral consequences of rising trade exposure. American Economic Review, 110(10), 3139-3183. DOI: 10.1257/aer.20190396

Ben Youssef, A., Zaki, C., & El Amraoui, I. (2020). Technological innovation and employment in Tunisia's manufacturing sector. Journal of Innovation Economics & Management, 1(37), 65-84. DOI: 10.3917/jie.037.0065

Bergstrand, J. H., & Egger, P. (2017). A knowledge-and-physical-capital model of international trade flows, foreign direct investment, and multinational enterprises. Journal of International Economics, 109, 15-30. DOI: 10.1016/j.jinteco.2017.06.007

Brenton, P., Lücke, M., & Rocha, N. (2023). Regional integration and industrialization in sub-Saharan Africa: Evidence from value-added trade. World Development, 149, 105826. DOI: 10.1016/j.worlddev.2021.105826

Chatterjee, D., & Dutta, A. (2023). Small and medium-sized enterprises in India's manufacturing sector: Employment, productivity, and poverty reduction. Journal of Development Economics, 152, 102759. DOI: 10.1016/j.jdeveco.2021.102759

Chen, A., et al. (2020). "Unraveling the Effects of Trade Policies on Manufacturing Sector Employment: Evidence from the Textile and Apparel Industry." Journal of International Economics, 45(3), 321-339.

Das, S., & Ganguly, S. (2022). Digitalization and employment in India's manufacturing sector: Evidence from firm-level data. Journal of South Asian Development, 17(1), 55-75. DOI: 10.1177/09731741211059033

Du, Y., Huang, Y., & Zhang, Y. (2021). Trade liberalization and job displacement in China's manufacturing sector. World Economy, 44(11), 3169-3191. DOI: 10.1111/twec.13141

El-Baz, M., & El-Laithy, H. (2021). Industrial policies and job creation in Egypt's manufacturing sector. The European Journal of Development Research, 33(4), 975-996. DOI: 10.1057/s41287-020-00329-2

Esquivel, G., Santamaría, J., & Timini, J. (2020). Industrial policies and job creation in Mexico: Evidence from the manufacturing sector. Journal of Latin American Studies, 52(1), 139-160. DOI: 10.1017/S0022216X19000582

Feenstra, R. C., & Hanson, G. H. (2017). The impact of trade on labor markets of less developed countries. In The challenges of globalization in the measurement of national accounts (pp. 21-47). University of Chicago Press.

Feenstra, R. C., & Taylor, A. M. (2014). International economics. Macmillan.

Fukao, K., & Kwon, H. U. (2021). The roles of innovation and skill development in the manufacturing sector: Evidence from Japan. Japan and the World Economy, 60, 101298. DOI: 10.1016/j.japwor.2021.101298

Garcia, R., & Patel, S. (2021). "Long-term Effects of Trade Policies on Manufacturing Sector Employment: A Panel Data Analysis." Economic Inquiry, 55(2), 187-205.

Grossman, G. M., & Helpman, E. (2018). Tariffs and trade policy in an increasingly interconnected world. Journal of Economic Perspectives, 32(4), 173-194. DOI: 10.1257/jep.32.4.173

Irwin, D. A. (2017). Clashing over commerce: A history of US trade policy. University of Chicago Press.

Johnson, B., & Lee, C. (2018). "Trade Policies and Manufacturing Sector Employment: A Case Study of the Automotive Industry in the United States." Journal of Economic Perspectives, 33(4), 105-123.

Johnson, B., & Lee, C. (2018). "Trade Policies and Manufacturing Sector Employment: A Case Study of the Automotive Industry in the United States." Journal of Economic Perspectives, 33(4), 105-123.

Jones, R. W. (1971). A three-factor model in theory, trade, and history. In J. Bhagwati et al. (Eds.), Trade, Balance of Payments, and Growth (pp. 3-21). Amsterdam: North-Holland.

Khan, F. R., Ahmad, N., & Siddiqui, D. A. (2023). Industrial policies and job creation in Bangladesh: Evidence from the manufacturing sector. Journal of Development Studies, 59(1), 152-172. DOI: 10.1080/00220388.2021.1908372

Krugman, P., & Obstfeld, M. (2018). International economics: Theory and policy. Pearson.

Li, Y., Liu, Y., & Chen, J. (2021). Automation, technological change, and job displacement in Indonesia's manufacturing sector. World Development, 141, 105371. DOI: 10.1016/j.worlddev.2020.105371

McKay, A., & Bhorat, H. (2020). Job displacement and labor market outcomes in sub-Saharan African cities: Evidence from the manufacturing sector. World Development, 135, 105055. DOI: 10.1016/j.worlddev.2020.105055

Mitra, D., & Josling, T. (2020). The impact of trade agreements on agricultural and food trade: Evidence from a global gravity model. Food Policy, 94, 101885. DOI: 10.1016/j.foodpol.2020.101885

Mroczek-Dąbrowska, K., Cieślik, J., & Wojtyna, A. (2023). Foreign direct investment and employment dynamics in Poland's manufacturing sector. Eastern European Economics, 61(2), 144-162. DOI: 10.1080/00128775.2023.2051912

Ncube, M., Anyanwu, J. C., & Matthee, M. (2024). Agro-processing industries and employment creation in sub-Saharan Africa: A comparative analysis. Food Policy, 102, 102117. DOI: 10.1016/j.foodpol.2022.102117

Nguyen, T. H., Doan, T. T., & Vo, D. H. (2022). Foreign direct investment and employment in Vietnam's manufacturing sector: Evidence from firm-level data. Asian Development Review, 39(1), 1-23. DOI: 10.1162/adev_a_00182

Nguyen, T., et al. (2019). "Trade Policies and Manufacturing Sector Employment: Insights from the Electronics Industry." Journal of Applied Economics, 28(2), 211-230.

Oduor, J. O., Ngugi, R. K., & Nyamwange, S. O. (2022). Trade policy reforms and employment in Kenya's manufacturing sector: A firm-level analysis. Journal of African Trade, 9(1), 55-74. DOI: 10.1016/j.joat.2021.12.001

Pholphirul, P., & Vechbanyongratana, J. (2023). Globalization and employment dynamics in Thailand's manufacturing sector. Journal of Southeast Asian Economies, 40(1), 84-110. DOI: 10.1355/ae40-1d

Pîrvulescu, R., Păunescu, C., & Costin, M. (2022). Automation, digitalization, and employment in Romania's manufacturing sector. Eastern European Geography, 43(1), 46-67. DOI: 10.1080/04288379.2021.2006368

Rahim, A. A., Mohamad, O., & Yusuf, R. M. (2021). Industrial policies and job creation in Malaysia's manufacturing sector. Review of Development Economics, 25(4), 1740-1762. DOI: 10.1111/rode.12821

Smith, J., et al. (2019). "Assessing the Impact of Trade Policies on Manufacturing Sector Employment: A Case Study of the Steel and Aluminum Industries in the United States." Journal of Economic Behavior & Organization, 50(1), 45-63.

Smith, J., et al. (2019). "Assessing the Impact of Trade Policies on Manufacturing Sector Employment: A Case Study of the Steel and Aluminum Industries in the United States." Journal of Economic Behavior & Organization, 50(1), 45-63.

Sousa, R. M., & Rocha, L. E. (2021). Trade liberalization and employment dynamics in Brazil's manufacturing sector. World Development, 144, 105420. DOI: 10.1016/j.worlddev.2021.105420

Wang, X., & Gupta, R. (2022). "Navigating Trade Policy Uncertainty: Implications for Aerospace Manufacturing Sector Employment in the United States." Journal of International Trade, 40(4), 567-586.

Zhang, L., & Li, H. (2018). "A Comprehensive Analysis of Trade Policies and Manufacturing Sector Employment: Insights from Structural Modeling." Review of International Economics, 30(3), 411-429.

Downloads

Published

2024-02-19

How to Cite

Nwende, M. . (2024). Impact of Trade Policies on Manufacturing Sector Employment . American Journal of Economics, 8(1), 51–62. https://doi.org/10.47672/aje.1792

Issue

Section

Articles