Xavier Cirera

The impact of export processing zones on employment, wages and labour conditions in developing countries: systematic review

ABSTRACT One of the most common instruments of industrial policy is Export Processing Zones (EPZs). This paper shows the results of a systematic review of the impact of EPZs on employment, wages and labour conditions in developing countries. The results of synthesising 59 studies suggest that there is no robust evidence that the employment created in the zones is additional. Also, in most cases, EPZs pay higher wages and do not contribute to increase the gender wage gap. The results regarding labour conditions such as health and safety, unionisation or hours worked are mixed when comparing with firms outside the EPZ.

The export-productivity link in Brazilian manufacturing firms

This paper explores the link between exports and total factor productivity in Brazilian manufacturing firms over the period 2000–08. The Brazilian experience is instructive, as it is a case of an economy that expanded aggregate exports significantly, but with stagnant aggregate growth in total factor productivity. The paper first estimates firm-level total factor productivity under alternative assumptions (exogenous and endogenous law of motion for productivity) following a GMM procedure. In turn, the analysis uses stochastic dominance techniques to assess whether the ex ante most productive firms are those that start exporting (self-selection hypothesis). Finally, the paper tests whether exporting boosts firms’ total factor productivity growth (learning-by-exporting hypothesis) using matching techniques to control for the possibility that selection into exports may not be a random process. The results confirm the self-selection hypothesis and show that starting to export yields additional growth in total factor productivity that emerges since the firm’s first year of exporting but lasts only one year. Further, this extra total factor productivity growth is much higher under the assumption of an endogenous law of motion for productivity, which reinforces the importance of accounting for firm export status to study the evolution of productivity.

Measuring Firm-Level Innovation Using Short Questionnaires: Evidence from an Experiment

Little is known about innovation in developing countries, partly because of the lack of comparable and reliable data. Collecting data on firm-level innovation is challenging because of the subjective definition of what determines an innovation, a problem that is exacerbated in developing countries where innovation is likely to be more incremental and less radical. This paper contributes to the literature by presenting the results of an experiment aiming to identify the survey instrument that better captures firm-level innovation in developing countries. The paper shows that a small set of questions included in a multi-topic, firm-level survey does not provide an accurate picture of firm-level innovation and tends to overestimate innovation rates. Issues related to framing explain some of the unreliability of innovation responses, while cognitive problems do not appear to play a significant role.