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International trade, Labor economics
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Last updated June 6, 2023
Dr. Raymond Robertson is a professor and holder of the Helen and Roy Ryu Chair in Economics and Government in the Department of International Affairs at the Bush School of Government and Public Service. He is a research fellow at the Institute for the Study of Labor in Bonn, Germany. Robertson earned a BA in political science and economics from Trinity University in San Antonio, Texas, and an MS and PhD in economics from the University of Texas at Austin. He has taught at the Maxwell School of Citizenship and Public Affairs at Syracuse University, and was a visiting professor in the Department of Economics at the Graduate School of Administration, Monterrey Institute of Technology’s Mexico City campus. Widely published in the field of labor economics and international economics, Robertson currently chairs the US Department of Labor’s National Advisory Committee for Labor Provisions of the US Free Trade Agreements and is a member of the Center for Global Development’s advisory board.
Publication Search Results
Now showing 1 - 10 of 17
Publication(Washington, DC: World Bank, 2016-03-23) Lopez-Acevedo, Gladys ; Robertson, Raymond ; Lopez-Acevedo, Gladys ; Robertson, RaymondSouth Asia is in the midst of a demographic transition. For the next three decades, the growth of the region’s working age population will far outpace the growth of dependents. Close to one million individuals will enter the workforce every month. This large, economically active population can increase the region’s capacity to save and make crucial investments in physical capital, job training, and technological advancement. But for South Asia to realize these dividends, it must ensure that its working-age population is productively employed. As one of the most prominent labor-intensive industries in developing countries, apparel manufacturing is a prime contender. With around 4.7 million workers in the formal sector and another estimated 20.3 million informally employed (combined with textiles), apparel already constitutes close to 40 percent of manufacturing employment. And given that much of apparel production continues to be labor-intensive, the potential to create more and better jobs is immense. There is a huge window of opportunity now for South Asia, given that China, the dominant producer for the last ten years, has started to cede some ground due to higher wages. But the region faces strong competition from East Asia—with Cambodia, Indonesia, and Vietnam already pulling ahead. Plus the sector suffers from production inefficiencies and policy bottlenecks that have prevented it from achieving its potential. Against this backdrop, this report hopes to inform the debate by measuring the employment gains that the four most populous countries in South Asia—Bangladesh, India, Pakistan and Sri Lanka (hereafter `SAR countries’)—can expect in this new environment of increased competition and scrutiny. Its main message is that it is important for South Asian economies to remove existing impediments and facilitate growth in apparel to capture more production and create more employment as wages rise in China. The successful manufacturers will be those who can supply a wide range of quality products to buyers rapidly and reliably—not just offer low costs.
Publication(World Bank, Washington, DC, 2020-03) Robertson, Raymond ; Kokas, Deeksha ; Cardozo, Diego ; Lopez-Acevedo, GladysThis paper studies how a positive export shock -- the sharp increase in garment-sector exports that began at the end of the Multifibre Arrangement (MFA) -- spread through Bangladesh's labor markets. Although the end of the MFA was arguably exogenous to Bangladesh, the authors instrument export demand with OECD imports to ensure identification. The paper compares estimates of the local labor market effects (wages and informality) and estimates from wage equations that reflect the predictions from long-run, general-equilibrium neoclassical trade theory. As in other studies, this paper finds that the export shock was localized both in terms of sector and geography. Wages increased and informality decreased in sub-districts more exposed to the export shock. Unlike in other studies, these local labor market effects dissipate quickly. Furthermore, Bangladesh's export shock was sector specific, limited predominantly to the female-intensive garment and textile sector. The paper shows that, following the increase in exports of the female-intensive good, the male-female wage gap closes considerably throughout the country -- not just in the apparel sector. In relatively small Bangladesh, the national labor market seems to be more integrated compared to larger countries studied, possibly suggesting that labor adjustment costs are lower in smaller countries.
Publication(World Bank, Washington, DC, 2015-11) Halliday, Timothy ; Lederman, Daniel ; Robertson, RaymondMexican wage inequality rose following Mexicos accession to the General Agreement on Tariffs and Trade/World Trade Organization in 1986. Since the mid-1990s, however, wage inequality has been falling. Since most trade models suggest that output prices can affect factor prices, this paper explores the relationship between output prices and wage inequality. The rise of inequality can be explained by the evolution of the relative price of skill-intensive goods relative to unskilled-intensive goods, but these prices flattened by 1999 and thus cannot explain the subsequent decline in wage inequality. An alternative trade model with firm heterogeneity driven by variations in the relative price of tradable relative to non-tradable goods can explain the decline in wage inequality. The paper compares this model’s predictions with Mexican inequality statistics using data on output prices, census data, and quarterly household survey data. In spite of the models simplicity, the model’s predictions match Mexican variables reasonably well during the years when wage inequality fell.
Publication(World Bank, Washington, DC, 2022-10) Berg, Claudia N. ; Robertson, Raymond ; Lopez-Acevedo, GladysUnlike many countries, the Arab Republic of Egypt did not experience significant labor market improvements following trade liberalization. This paper investigates why increased Egyptian exports did not directly increase employment. To illustrate the relationship between firm-level exporting and employment, the paper presents a simplified general equilibrium model with two sectors: one able to export and one “reserve” sector. The paper tests the implications of this theory using firm-level data from the World Bank’s Enterprise Surveys in 2013, 2016, and 2020. The firm-level microanalysis demonstrates that although there is a positive employment response to export expansion, it does not occur at a large enough scale to be felt at the macro level. To seize the benefits of trade, Egypt requires deeper business environment reforms to incentivize large export, labor-intensive sector growth and integrate its economy into global value chains.
Publication(World Bank, Washington, DC, 2022-10) Robertson, Raymond ; Vergara, Mexico ; Lopez-Acevedo, GladysThe Arab Republic of Egypt’s industries rely heavily on imported goods for production. Thus, an increase in imports could have a potentially positive effect on the labor market as it means more inputs for the production of exporting goods. Alternatively, minimal backward linkages in global value chains could also mean that increasing imports substitute for domestic production and, thus, lost employment opportunities. This paper evaluates the relationship between regional trade agreements using a gravity model and import flows to test whether rising imports have impacted wages, informality, and female labor force participation. The results suggest that imports are not to blame for disappointing labor market outcomes in Egypt.
Publication(Washington, DC: World Bank, 2019-02-24) Artuc, Erhan ; Lopez-Acevedo, Gladys ; Robertson, Raymond ; Samaan, DanielSouth Asia’s economy has grown rapidly, and the region has made a significant reduction in poverty. However, the available jobs for the growing working population remain limited. Policy makers are contending with lingering concerns about jobless growth and poor job quality. Exports to Jobs: Boosting the Gains from Trade in South Asia posits that exports, could bring higher wages and better jobs to South Asia. We use a new methodology to estimate the potential impact from higher South Asian exports per worker on wages and employment. We find that increasing exports per worker would result in higher wages, mostly for the better-off groups—like the better-educated workers, men, and the more-experienced workers—although the less-skilled and rural workers would benefit from new job opportunities outside of the informal sector. Our report shows that to spread the benefits from higher exports widely, policies are needed to raise skills and get certain groups, such as women and youth, into more and better jobs. Complementary measures include removing trade barriers and investing in infrastructure, and increasing the ability of workers to find higher-paying jobs. Together, these actions would help South Asian countries spread the gains from being closely integrated into the global economy through exporting. This book, which is the product of a partnership between the International Labour Organization and the World Bank, contributes to our understanding of the impact that growing exports can have on increasing well-being, and it bridges the gap between academic research and policy making.
Publication(World Bank, Washington, DC, 2016-10) Lederman, Daniel ; Robertson, RaymondCombining macroeconomic and microeconomic data and three indicators of international market integration, this paper assesses the degree to which Latin American labor markets are integrated. The results suggest that relative to East Asia, Latin American labor markets are somewhat more integrated, but considerable differences across countries persist. In addition, the evidence indicates that the degree of labor market integration across Latin American borders is significantly less than that of labor markets within Mexico and within the United States in two of the three indicators. These differences may suggest opportunities for efficiency gains from further labor market integration.
Publication(Washington, DC: World Bank, 2017-03-14) Bown, Chad P. ; Lederman, Daniel ; Pienknagura, Samuel ; Robertson, RaymondThis book proposes a renewal of 'Open Regionalism' in Latin America and the Caribbean (LAC) aimed at achieving the region's goals of high growth with stability. The LAC region experienced a growth spurt with equity during the first decade of the 21st Century. It is well understood that an unsustainable demand boom fueled by terms-of-trade improvements drove this growth acceleration episode, especially in South America. Unfortunately, terms of trade are no longer fueling growth, and the region’s policymakers are in search of new sources of growth with stability. With the experience of East Asia and the Pacific in mind, many policymakers in LAC are looking to international economic ties as a potential source of stable growth. The challenge highlighted in this book lies in designing an integration agenda comprising trade and factor market integration that is conducive to region-wide efficiency gains, which can help LAC enhance its global competitiveness. The forces of geography imply that pro-growth global integration cannot be achieved without building a strong neighborhood. Thus, this volume argues that LAC's regional economic integration agenda needs to go well beyond the current spaghetti bowl of preferential trading arrangements.
Publication(World Bank, Washington, DC, 2016-10-05) Lopez-Acevedo, Gladys ; Robertson, RaymondApparel is the largest labor-intensive manufacturing industry in South Asia, and is a major employer of women. Although South Asia’s apparel sector benefits from many of the same favorable conditions as East Asia’s, performance in South Asian apparel remains well below that of East Asia. The objective of this study is to identify the policy changes necessary for South Asia to capitalize on this opportunity. The authors review the apparel sectors in Bangladesh, India, Pakistan and Sri Lanka, and compare them with Vietnam and China. The report uses quantitative data (analysis based on a gravity model, enterprise and buyer surveys) and qualitative information (interviews with leading firms) to identify changes in policies that would enable South Asia to meet the requirements of global buyers. Low productivity and poor trade logistics make it difficult for South Asia’s apparel sector to compete in global markets, despite a cost advantage due to lower wages than other major exporters. Leading firms exhibit that world class operational performance can be achieved in South Asia by investing in training and technology. These firms overcame constraints in the external environment by achieving economies of scale, and in the case of India and Pakistan, by integrating vertically to avoid barriers to sourcing high-quality inputs on the global market. All countries should promote Plug and Play industrial zones with ready to use industrial buildings and facilities to promote women labor force participation, as female workers would be the main beneficiaries of growth in apparel production.
Publication(World Bank, Washington, DC, 2021-03) Robertson, RaymondDeepening preferential trade agreements extend coverage to social issues, including labor clauses. While there is a long history of debate over the intent of labor clauses, less is known about the impact of labor clauses. Recent studies show that labor clauses improve working conditions, but the impact on trade flows is still debated. Existing studies do not include a full set of fixed effects (to control for endogeneity and unobserved confounding factors), other dimensions of deep agreements that could be correlated with labor clauses (tariffs and other “deep” clauses), and pseudo-Poisson maximum likelihood estimation. This paper combines all three with additional robustness checks. While the estimated effect of trade agreements is positive overall, the estimated marginal relationship between labor clauses and trade volume is generally negative but varies with the type of clauses. Freedom of Association, Forced and Child Labor, and International Labor Standards are consistently associated with higher trade flows. Clauses that are more likely to eliminate illicit trade, including clauses related to discrimination, protection of working conditions, and third-party monitoring exhibit a negative marginal relationship with trade flows.