Men, women, and machines: How trade impacts gender inequality

This paper studies the effect of trade liberalization on an under-explored aspect of wage inequality — gender inequality. We consider a model where firms differ in their productivity and workers are differentiated by skill as well as gender. A reduction in tariffs induces more productive firms to modernize their technology and enter the export market. New technologies involve computerized production processes and lower the need for physically demanding skills. As a result, the relative wage and employment of women improves in blue-collar tasks, but not in white-collar tasks. We test our model using a panel of establishment level data from Mexico exploiting tariff reductions associated with the North American Free Trade Agreement (NAFTA). Consistent with our theory we find that tariff reductions caused new firms to enter the export market, update their technology and replace male blue-collar workers with female blue-collar workers.

That is from this paper by Chinhui Juhn, Gergely Ujhelyi, & Carolina Villegas-Sanchez. A draft is here. 

The Dalai Lama Effect on International Trade

Is political compliance a precondition for healthy trade relations with China? The Chinese government frequently threatens that meetings between its trading partners’ officials and the Dalai Lama will be met with animosity and ultimately harm trade ties. We run a gravity model of exports to China from 159 partner countries between 1991 and 2008 to test the extent to which bilateral tensions affect trade with autocratic China. In particular, we empirically investigate whether countries that receive the Dalai Lama despite China’s opposition experience a significant reduction in their exports to China. In order to account for the potential endogeneity of meetings with the Dalai Lama, the number of Tibet Support Groups and the travel pattern of the Tibetan leader are used as instruments. Our empirical results support the idea that countries officially receiving the Dalai Lama at the highest political level are punished through a reduction of their exports to China. However, this ‘Dalai Lama Effect’ is only observed for the Hu Jintao era and not for earlier periods. Furthermore, we find that this effect is mainly driven by reduced exports of machinery and transport equipment and that it disappears in the second year after a meeting took place.

Source. A draft of the paper is here.  

Import competition and dropout rates (The US)

. . . [W]e examine changes in dropout rates among American public high schools in the face of increased competition from Chinese manufacturing imports. Across a broad range of specifications, we find that as local import competition increases, high school students are less likely to drop out.

The paper is here. The ideas is that more import competition increases the returns to education. 

One More Reason in Favor of More Flexible Immigration Policies

. . . [F]irms import and export significantly more with countries that have a strong resident population near their firm headquarters location. . .   

We show that one particular channel of the information network is through board members: a connected local population predicts more board members from that same country, and a significantly higher value for those firms that exploit connected board members in their trade decisions.

That is from the new paper by Umit, Gurun, and Malloy (August 2012) "Channels of Influence." The evidence is from the US. 

Maquiladoras and economic development

An interesting finding mentioned in the book "Poor Economics:" [p. 229]

David Atkin, from Yale University, compared the hight of children born to mothers who lived in a town where a maquiladora opened when the woman was sixteen years old to that of children of mothers who did not have this opportunity. The children whose mother's town has a maquiladora were much taller than those born to similar women in different towns. This difference is so large that it can bridge the entire gap in hight between a poor Mexican child and the "norm" for a well-fed American child. 

The working paper is here -- conclusions are incomplete. Webpage of the author.