Munich Personal RePEc Archive

Heterogeneous labor demand: sectoral elasticity and trade effects in the U.S., Germany and Sweden.

Judzik, Dario (2014): Heterogeneous labor demand: sectoral elasticity and trade effects in the U.S., Germany and Sweden.

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Abstract

This paper analyzes labor demand at the sector level in the U.S., Germany and Sweden in two ways: by providing new computations of the sector elasticity of labor demand, and by evaluating the employment effects of trade in manufactures, services, agriculture and fuel. The elasticity is computed through a standard fixedeffects model and then by taking a semi-pooling sector-level approach (i.e., by flexibilizing the coefficient homogeneity assumption). Most sector-level elasticities differ largely from the aggregate estimate in all three countries. The employment effect of openness to trade is generally positive, although it varies according to country particularities. The employment effect of technical change may help in understanding Germany’s remarkable employment performance over the last decade.

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