Chapter

Trade Shifts and Sectoral Side‐Effects

Adrian Wood

in North-South Trade, Employment and Inequality

Published in print July 1995 | ISBN: 9780198290155
Published online November 2003 | e-ISBN: 9780191597015 | DOI: http://dx.doi.org/10.1093/0198290152.003.0005

Series: IDS Development Studies

 Trade Shifts and Sectoral Side‐Effects

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The main cause of the recent changes in the pattern of North–South trade seems to have been reductions in protection and in natural barriers to trade, making it possible to argue that these changes were an exogenous cause of shifts in the skill structure of the demand for labour in both country groups. These changes also raised the demand for labour in manufacturing in the South, and reduced it in the North, causing alterations in manufacturing's share of total employment. More than 20 million extra jobs in manufacturing were created in a few Southern countries. In the North, the immediate effect was to reduce the profitability of manufacturing, and subsequently to reduce the share of manufacturing in employment by around four percentage points—and by more in countries, which experienced greater increases in Southern import penetration.

Keywords: demand; employment; labour; manufacturing; protection; skill; trade

Chapter.  16620 words.  Illustrated.

Subjects: International Economics

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