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Université d’Auvergne Clermont-Ferrand I Faculté des Sciences Economiques et de Gestion Centre d’Etudes et de Recherches sur le Développement International (C.E.R.D.I) ESSAIS SUR LA LIBERALISATION COMMERCIALE ET LES INEGALITES DE REVENUS DANS LES PAYS EN DEVELOPPEMENT ESSAYS ON TRADE LIBERALIZATION AND INCOME INEQUALITY IN DEVELOPING COUNTRIES THESE NOUVEAU REGIME Présentée et soutenue publiquement Pour l’obtention du titre de Docteur ès Sciences Economiques Par Julien Gourdon Sous la Direction de M. le Professeur Jaime de Melo NOVEMBRE 2007 Membres du Jury : Directeurs Rapporteurs Président Jaime de Melo, Professeur à l’Université de Genève. Marcelo Olarreaga, Professeur à l’Université de Genève. Lionel Fontagné, Professeur à l’Université de Paris Sorbonne. Patrick Guillaumont, Professeur à l’Université d’Auvergne (CERDI). La faculté n’entend donner aucune approbation ou improbation aux opinions émises dans cette thèse. Ces opinions doivent être considérées comme propre à leur auteur. La réalisation de ce travail n’aurait été possible sans l’aide des membres du CERDI, sans les nombreux conseils des chercheurs invités au CERDI et sans les échanges avec des participants à des colloques extérieurs. Qu’ils en soient remerciés. Je tiens tout particulièrement à exprimer ma reconnaissance à mon directeur Jaime de Melo. Merci au soutien constant apporté par famille et amis, ainsi qu’à leur inépuisable patience. Enfin j’ai une pensée toute particulière pour Clémence, qui m’a soutenu, supporté et encouragé ces dernières années. CONTENTS INTRODUCTION_____________________________________________ 1 CHAPTER 1: EXPLAINING TRADE FLOWS: TRADITIONAL AND NEW DETEMINANTS OF TRADE PATTERNS _________________________ 11 1. 2. Introduction ______________________________________________ 12 2.1 2.2 3.1 3.2 3.3 3.4 3.5 4.1 4.2 4.3 4.4 Approaches to explain trade patterns ________________________ 16 Empirical approach to “test” the theorem _____________________ 17 Extensions to the strict HO theorem __________________________ 21 A selection model __________________________________________ 26 Construction & measure for commodities’ clusters _____________ 31 Construction & measure for factors endowments ______________ 33 Construction & measure of “new” determinants of trade _______ 35 Construction & measure of trade intensity explanatory variables 35 Goodness of fit ____________________________________________ 37 Conventional factors versus “new” factors: ANOVA estimates __ 38 Comparative advantage_____________________________________ 40 Intensity of Trade __________________________________________ 45 3. Empirical approach________________________________________ 26 4 Results___________________________________________________ 36 5 Conclusions ______________________________________________ 48 REFERENCES __________________________________________________ 51 APPENDICES __________________________________________________ 55 A.1: List of countries included in the sample 1970-2000 ______________ 56 A.2: Variance of variables________________________________________ 57 A.3: Graphs Non linearity between factor endowments and probability of being net exporter _________________________________________________ 58 A.4: Determinants of Comparative Advantage: Probit on the probability of being a net exporter of each commodity cluster for 1960-1980 and 19802000 60 A.5: Graphs Non linearity between Openness and Net Exports for status S=1 and S=0 ______________________________________________________ 62 CHAPTER 2: OPPENESS AND INEQUALITY IN DEVELOPING COUNTRIES: A NEW LOOK AT THE EVIDENCE __________________ 64 1 2 Introduction ______________________________________________ 65 2.1 2.2 Empirical approach________________________________________ 69 Usual test _________________________________________________ 69 Heterogeneity among developing countries ___________________ 70 i 2.3 2.4 Different skill categories____________________________________ 73 Differences in natural resource abundance____________________ 74 Which sort of index for openness? ___________________________ 75 A Gravity model to measure Openness _______________________ 77 Robustness test of the gravity-based index ____________________ 82 3 3.1 3.2 3.3 Measure of openness through a gravity model________________ 75 4 4.1 Data and econometric specifications _________________________ 83 4.2 Extensions of previous results _______________________________ 86 4.3 Adding different skill categories and accounting for mineral/fuel resources _________________________________________________________ 89 4.4 Robustness checks _________________________________________ 95 Trade openness and income inequality ______________________ 83 5 Conclusions ______________________________________________ 97 REFERENCES __________________________________________________100 APPENDICES _________________________________________________ 104 A.1: List of countries included in the sample 1970-2000 _____________ 104 List of variables and data sources ____________________________ 105 A.2: Construction of index of relative factor endowment (RE)________ 105 A.3: Index of Trade Openness ___________________________________ 106 A.4: A.5a: Relative Factor Endowments: percentile distribution ___________ 108 Tariff reduction, inequality and factor endowments (full result A.5b: table 7b and 7c)___________________________________________________ 108 Different Measure for Human Capital and Land resources ______ 109 A.6: A.7: Inequality, different skill categories and openness: results by Quintile _________________________________________________________ 110 Adding macro and institutional variables as control ____________ 111 A.8: CHAPTER 3: TRADE AND WAGE INEQUALITY IN DEVELOPING COUNTRIES: SOUTH-SOUTH TRADE MATTERS ________________ 112 1 2 Introduction _____________________________________________ 113 2.1 2.2 2.3 2.4 2.5 2.6 2.7 Review of the Empirical Literature _________________________ 117 Basic Stopler-Samuelson Theory____________________________ 117 Evidence for Developing Countries _________________________ 117 Heterogeneity among developing countries __________________ 119 Shifting industries from North to South _____________________ 120 Skill-biased technological change___________________________ 121 Industry wage premiums __________________________________ 122 Cross-countries studies ____________________________________ 123 3 4 South-South trade and wage inequality: a model ____________ 127 4.1 4.2 South-South trade and wage inequality: A first look at the data130 Inter industry Specialization among developing countries _____ 131 Sector biased technological change__________________________ 134 5 Econometric specification _________________________________ 135 ii 5.1 5.2 Models __________________________________________________ 135 Data _____________________________________________________ 138 6 6.1 South-South trade increases wage inequality for middle income countries ________________________________________________________ 139 6.2 Sector biased technological change matter ___________________ 141 6.3 Quantile estimations on industries__________________________ 143 TFP rather than Labor productivity _________________________ 145 6.4 6.5 Robustness check _________________________________________ 146 OLS Results _____________________________________________139 7 8 GMM System____________________________________________ 147 Conclusions _____________________________________________ 151 REFERENCES _________________________________________________ 153 APPENDICES _________________________________________________ 159 A.1: List of countries included in the sample 1976-2000 _____________ 159 A.2: Classification of Isic Industry according to Skill Intensity _______ 160 A.3: List of variables ___________________________________________ 161 A.4: Quantile Regressions ______________________________________ 162 A.5: Total Factor Productivity (TFP) ______________________________ 163 A.6: Adjusted trade openness index ______________________________ 164 A.7: Alternative measures for wage inequality and trade openness ___ 166 iii INTRODUCTION Globalisation process and the link with Poverty in developing countries In the age of globalization, the question whether inequality in the world rose or fell down in developing countries during their integration into the world trading system is a hot topic. There is more than ever talk and writing on globalization and one of its apparent effects—increased inequality. To anti-globalization protesters, “transnational corporations . . . expand, invest and grow, concentrating ever more wealth in a limited number of hands.” Agents such as the International Monetary Fund (IMF) and World Bank are said to be aiming at an outcome “in which all productive assets are owned by foreign corporations producing for export.” Recently, “globalization from above” has shifted “towards a more destructive phase, marked by increased militarization, worldwide recession, and increased economic inequality.” The protesters usually claim that globalization is a disaster for the workers, throwing them into “downward wage spirals in both the North and the South.”. Economists view on the subject Economists find such rhetoric hard to take, since the neoclassical model of growth identifies at least three ways in which globalization makes the poor of the world better off. Let us define globalization as the movement across international borders of goods and factors of production and adopt the standard assumption of the neoclassical model that poor countries are poor 1
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