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Author Alexandre, Fernando ♦ Bação, Pedro ♦ Cerejeira, João ♦ Portela, Miguel
Source EconStor
Content type Text
Publisher Institute for the Study of Labor (IZA)
File Format PDF
Language English
Subject Domain (in DDC) Social sciences ♦ Economics
Subject Keyword exchange rates ♦ international trade ♦ job flows ♦ labour market rigidity ♦ technology ♦ Labor Demand ♦ Trade and Labor Market Interactions ♦ Open Economy Macroeconomics
Abstract In this paper, we explore empirically the role of openness, technology and labour market rigidity in the determination of the effect of the exchange rate on employment in Portugal. We develop an index that allows us to measure labour market flexibility at the sector level. This index shows that labour market flexibility has been increasing in all manufacturing sectors and that the labour market in high technology sectors is more flexible than in low technology sectors. We use this index in the estimation of an employment regression, focusing on the effect of exchange rate movements. Our estimates indicate that employment in lowtechnology sectors, with a high degree of trade openness and facing less rigidity in the labour market are more sensitive to movements in exchange rates.
Part of series IZA Discussion Papers x5251
Learning Resource Type Article
Publisher Date 2010-01-01
Publisher Place Bonn
Rights Holder http://www.econstor.eu/dspace/Nutzungsbedingungen