DP15223 TBTs, Firm Organization and Labour Structure

Author(s): Giorgio Barba Navaretti, Lionel Fontagne, Gianluca Orefice, Giovanni Pica, Anna Rosso
Publication Date: August 2020
Keyword(s): labor demand, Non-Tariff Measures, skill composition, Trade Barriers
JEL(s):
Programme Areas: Labour Economics, International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=15223

This paper investigates the effects on firms' occupational structure of shocks induced by the intro- duction of Technical Barriers to Trade (TBTs) in importing countries. We rely on the Specific Trade Concern (STC) data released by the WTO to identify trade-restrictive TBT measures, combined with matched employer-employee data for the population of French exporters over the period 1995- 2010, and with information on the list of product-destinations served by each French exporter. Con- trolling for time-invariant firm/occupation effects and for time-varying sector/occupation shocks, IV estimates show that exporters respond to increased complexity associated with restrictive TBTs at destination by raising the share of managers at the expense of blue collars, white collars and professionals. This evidence is consistent with the growing literature exploring how frms organize their workforce composition in presence of exogenous (foreign) shocks; and it is also related to the well-beaten literature on the labour market effects of trade.