An empirical assessment of the effects of trade on employment in Australia: 1989/1990-2000/2001
This paper investigates the link between trade reforms, intra-industry trade and labour market adjustment in Australia. In the light of the foregoing, it is hypothesised that trade reforms have (a) had a negative impact on overall employment as increased openness serves to enhance the efficiency with which labour is utilised and (b) have had a positive impact on employment to the extent that trade flows are intra-industry. The assumption is that individuals can easily match their skills within the sector in order to ensure the associated rewards, and need to shift to other sectors only as this possibility diminishes. We find strong support for (a) but only weak support for (b).