Explaining the employment effect of exports: Value-added content matters

Abstract

This paper estimates and decomposes the impact of export opportunities on countries' employment by using a global input-output analysis, focusing on the U.S., China, and Japan.The greater they export, the greater employment in the exporting countries. However, we first document that the number of jobs created per exports varies substantially across destination countries. We find that exports from sectors with higher domestic value-added contents such as natural resource, textile, and service sectors lead to a greater employment effect. As a result, cross-country differences in sectoral compositions of exports explain a large part of the variations in the employment effects across destination countries. Time series changes in the employment effect of exports come from changes in (1) the labor-tooutput ratio, (2) input-output linkages, and (3) sectoral compositions in exports. Results suggest that the first channel worked to reduce the employment effect in all of the three countries we focused but the directions of the last two channels are different across the countries.

Exports to China and Local Employment in South Korea

“…The estimated effects of the exports to the US and other countries, using both the OLS and the 2SLS estimations, are moderate and noisy. Previous studies, such as Brambilla et al (2012), Bastos et al (2018), andSasahara (2019) show that the effect of exports on employment varies across destination countries, especially when exporting sectors are heterogeneous across destination countries. Some exporting sectors have a greater spillover effect in value chains than others.…”

Combined soft measurement on key indicator parameters of new competitive advantages for China's export

“…Research on the technical competitiveness of export products is mainly based on the measurement of the technical complexity of export products (Waugh and Ravikumar 2016;Zhao et al 2018) and the exploration of its influencing factors (Sasahara 2019;Tian and Lin 2017). In recent years, Zhu et al (2019) have investigated the international market power of China's tungsten export market from the perspective of tungsten export policies, and they have analyzed the reasons for China's rising market power and the effectiveness of its export policies, while proposing corresponding policy recommendations.…”

Agricultural Exports, Other Exports, Imports, and Economic Growth: An ARDL Approach for Tunisia

“…Exports stimulate an economy by ensuring the sustainability of companies, which in the context of globalization is strongly linked to their position in the world market and to the establishment of competitive advantage (Piercy et al, 1998). Furthermore, exports are considered a powerful catalyst for promoting and fueling investment growth, ultimately leading to higher employment rates through the implementation of effective strategies and policies supported by sound governance (Brambilla et al, 2015;Sasahara, 2019).…”