Publication:
Labor Market Effects of Global Supply Chain Disruptions

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dc.contributor.authorUlate, Mauricio
dc.contributor.authorVasquez, Jose P.
dc.contributor.authorZarate, Roman D.
dc.date.accessioned2023-05-08T18:36:00Z
dc.date.available2023-05-08T18:36:00Z
dc.date.issued2023-05-08
dc.description.abstractThis paper examines the labor market consequences of recent global supply chain disruptions induced by COVID-19. Specifically, it considers a temporary increase in international trade costs similar to the one observed during the pandemic and analyzes its effects on labor market outcomes using a quantitative trade model with downward nominal wage rigidities. Even omitting any health-related impacts of the pandemic, the increase in trade costs leads to a temporary but prolonged decline in U.S. labor force participation. However, there is a temporary increase in manufacturing employment as the United States is a net importer of manufactured goods, which become costlier to obtain from abroad. By contrast, service and agricultural employment experience temporary declines. Nominal frictions lead to temporary unemployment when the shock dissipates, but this depends on the degree of monetary accommodation. Overall, the shock results in a 0.14 percent welfare loss for the United States. The impact on labor force participation and welfare across countries varies depending on the initial degree of openness and sectoral deficits.en
dc.identifierhttp://documents.worldbank.org/curated/en/099742505022340571/IDU0776102410a010044910917405a6c7fe5fb87
dc.identifier.doi10.1596/1813-9450-10434
dc.identifier.urihttps://openknowledge.worldbank.org/handle/10986/39789
dc.languageEnglish
dc.language.isoen
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Papers; 10434
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by/3.0/igo/
dc.subjectSUPPLY CHAIN DISRUPTION
dc.subjectTRADE COST
dc.subjectDOWNWARD NOMINAL WAGE RIGIDITY
dc.subjectCOVID IMPACT ON LABOR MARKET
dc.subjectUS LABOR FORCE PARTICIPATION DECLINE
dc.subjectPANDEMIC LABOR MARKET IMPACT
dc.titleLabor Market Effects of Global Supply Chain Disruptionsen
dc.typeWorking Paper
dspace.entity.typePublication
okr.crossref.titleLabor Market Effects of Global Supply Chain Disruptions
okr.date.disclosure2023-05-02
okr.date.lastmodified2023-05-02T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099742505022340571/IDU0776102410a010044910917405a6c7fe5fb87
okr.guid099742505022340571
okr.identifier.docmidIDU-77610241-a010-4491-9174-5a6c7fe5fb87
okr.identifier.doi10.1596/1813-9450-10434
okr.identifier.doihttp://dx.doi.org/10.1596/1813-9450-10434
okr.identifier.externaldocumentum34054471
okr.identifier.internaldocumentum34054471
okr.identifier.reportWPS10434
okr.import.id637
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099742505022340571/pdf/IDU0776102410a010044910917405a6c7fe5fb87.pdfen
okr.region.countryUnited States
okr.region.geographicalWorld
okr.topicSocial Protections and Labor::Labor Markets
okr.topicRural Development::Rural Labor Markets
okr.topicMacroeconomics and Economic Growth::Economic Forecasting
okr.topicInternational Economics and Trade::Trade and Labor
okr.unitDECRG: Trade & Intl. Integration (DECTI)
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