Discussion Paper Details

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Title: Services Policy Reform and Manufacturing Employment: Evidence from Transition Economies

Author(s): Matteo Fiorini, Bernard Hoekman and Clément Malgouyres

Publication Date: December 2016

Keyword(s): economic reform, employment, service-sector policies, structural transformation and transition economies

Programme Area(s): International Trade and Regional Economics

Abstract: Policy reforms targeting the services sectors influence the process of structural transformation and economic development. This paper used sector-level panel data for 24 transition economies for the 1990-2012 period to analyze the impacts of services policy reforms on employment in downstream manufacturing sectors. We find that negative effects on manufacturing employment are mitigated or disappear for countries with better economic governance and higher levels of human capital. The decline in manufacturing employment is observed only in the first decade of transition. The estimated negative effect of policy reforms is of a contemporaneous nature; it does not persist along the lag structure.

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Bibliographic Reference

Fiorini, M, Hoekman, B and Malgouyres, C. 2016. 'Services Policy Reform and Manufacturing Employment: Evidence from Transition Economies'. London, Centre for Economic Policy Research.