On the welfare effects of a ‘duty-free zone’

Hamilton, Carl; Svensson, Lars E. O.

doi:10.1016/0022-1996(82)90005-8

Cited by 84 publications

(47 citation statements)

References 8 publications

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“…Two critical assumptions of the model are the fact that the labour-intensive product is not produced in the EPZ and that there is full employment. When these two assumptions are relaxed, the EPZ is not welfare decreasing (Hamilton and Svensson 1982; Young and Miyagiwa 1987). …”

Section: Epzs and Employment Outcomesmentioning

confidence: 99%

The impact of export processing zones on employment, wages and labour conditions in developing countries: systematic review

Cirera

Lakshman

2017

Journal of Development Effectiveness

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One of the most common instruments of industrial policy is Export Processing Zones (EPZs). This paper shows the results of a systematic review of the impact of EPZs on employment, wages and labour conditions in developing countries. The results of synthesising 59 studies suggest that there is no robust evidence that the employment created in the zones is additional. Also, in most cases, EPZs pay higher wages and do not contribute to increase the gender wage gap. The results regarding labour conditions such as health and safety, unionisation or hours worked are mixed when comparing with firms outside the EPZ.

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Section: Epzs and Employment Outcomesmentioning

confidence: 99%

The impact of export processing zones on employment, wages and labour conditions in developing countries: systematic review

Cirera

Lakshman

2017

Journal of Development Effectiveness

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“…Unlike a larger number of references including Devereux and Chen (1995) and Schweinberger (2003) highlighting the desirability of SEZs for the stimulation of foreign capital inflows, some economists like Hamada (1974), Rodriguez (1976) and Hamilton and Svensson (1982) argue in the Heckscher-Ohlin framework that foreign investment attracted in SEZs can have an effect of lowering welfare. ''The root cause of possible immiserization effects in developing countries .…”

Section: Free Economic Zones As An Instrument Of Economic Growth and mentioning

confidence: 98%

Do Corporate Tax Concessions Really Matter for the Success of Free Economic Zones?

Nam

Rădulescu

2004

Econ Change

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Not only a large number of developing countries but also transition economies have established free economic zones (FEZs) with the aim of attracting foreign capital by providing tax incentives, creating employment opportunities, and promoting exports and regional development. Tax investment promotion schemes include profit tax exemption, free or accelerated depreciation, investment tax allowance, subsidy for investment costs, etc., the effects of which on firms’ investment decisions can be compared based on the net present value model. This study suggests that even a low corporate tax rate combined with generous depreciation rules does not provide incentives for investors when the inflation rate is high. A case study on Najin–Sonbong FEZ in North Korea delivers a wide range of more crucial economic and political reasons why such a development project can fail, although tax concessions offered there are more favourable than those in China and other Asian nations. Copyright Springer 2004free economic zone, investment decision, net present value, tax concessions,

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“…Apart from arguments related to the welfare effects of different factor intensities in EPZ sectors (Hamilton and Svensson, 1982), little research is related to optimal EPZ industry structure. Should one aim at a homogenous export industry structure, or should one allow for a heterogeneous structure?…”

Section: Introductionmentioning

confidence: 99%

A comment on the optimal structure of Export-Processing free Zones

Borgersen

2008

IJTGM

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On the welfare effects of a ‘duty-free zone’

Cited by 84 publications

References 8 publications

The impact of export processing zones on employment, wages and labour conditions in developing countries: systematic review

The impact of export processing zones on employment, wages and labour conditions in developing countries: systematic review

Do Corporate Tax Concessions Really Matter for the Success of Free Economic Zones?

A comment on the optimal structure of Export-Processing free Zones

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