The Long-Run Labor Market Effects of the Canada-U.S. Free Trade Agreement / Brian K. Kovak, Peter M. Morrow.

Format:

Book

Author/Creator:

Kovak, Brian K.

Contributor:

National Bureau of Economic Research.

Morrow, Peter M.

Series:

Working Paper Series (National Bureau of Economic Research) no. w29793.

NBER working paper series no. w29793

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2022.

Summary:

This paper assesses the long-run effects of the 1988 Canada-U.S. Free Trade Agreement (CUSFTA) on the Canadian labor market using matched longitudinal administrative data for the years 1984-2004. We simultaneously examine the labor market effects of increased export expansion and import competition, generally finding adverse effects of Canadian tariff cuts and favorable effects of U.S. cuts, though both effects are small. Workers initially employed in industries that experienced larger Canadian tariff concessions exhibit a heightened probability of layoffs at large firms, but little impact on long-run cumulative earnings. Lower earnings and years worked at the initial employer are offset by gains in other manufacturing industries, construction, and services. Canadian workers quickly transitioned out of industries facing import competition, with the majority of industry adjustment occurring among new entrants to the labor market.

Notes:

Print version record

February 2022.