Trade Liberalisation, Labour Productivity Growth and Skilled Labour Complement: Evidence from the Thai Manufacturing Sector

Abstract

Trade liberalisation in Thailand raised two wider questions regarding the labour market-one with regards to the link with labour productivity and the other the link with skilled workers. This outcome provides a link between (1) trade liberalisation and labour productivity growth, and, (2) skilled employment and labour productivity growth. Trade liberalisation is also correlated with skilled employment. This type of evidence matches conventional explanations for the beneficial allocation of trade liberalisation and demanding skills training for potential future industrial growth. Abstract Trade liberalisation in Thailand raised two wider questions regarding the labour market-one with regards to the link with labour productivity and the other the link with skilled workers. This outcome provides a link between (1) trade liberalisation and labour productivity growth, and, (2) skilled employment and labour productivity growth. Trade liberalisation is also correlated with skilled employment. This type of evidence matches conventional explanations for the beneficial allocation of trade liberalisation and demanding skills training for potential future industrial growth.

The Industrial Sector Participation in Global Value Chains for Sustainable Development of the Greater Mekong Subregion (GMS)

“…International trade in the industrial sector has both positive and negative impacts on the framework of UN's sustainable development. In the context of GMS countries, for example, in terms of full employment and valuable work for everyone (Target number 8), it is found in the study of Sangkaew and Jayanthakumaran (2013) that free trade brought about an increase in wages of workers in the Thai industrial sector, even though only a small increase, while export in the Thai industrial sector negatively impacted the wage increase with statistical significance. This reflects the problem of inequality and equality (Target number 10).…”

“…This reflects the problem of inequality and equality (Target number 10). Sangkaew and Jayanthakumaran (2013) describe the causes of such wage disparities that might have come from a relatively high competition after the free trade, resulting in little profits received by exporters. Also, most of the export sector in Thailand comprises capital-intensive products.…”