Working Paper
Trade with China and India and Manufacturing Labour Demand in Argentina

For many in Latin America, the increasing participation of China and India in international markets is seen as a looming shadow of two ‘mighty giants’ on the region’s manufacturing sector. Are they really mighty giants when it comes to their impact on manufacturing employment? This paper attempts to answer this question by estimating the effects of trade with China and India on Argentina’s industrial employment. We use a dynamic econometric model and industry level data to estimate the effects of trade with China and India on the level of employment in Argentina’s manufacturing sector. Results suggest that trade with China and India only had a small negative effect on industrial employment, even during the swift trade liberalization of the 1990s.