Trade Exposure, Consumption Inequality, and Labor Markets: a Study of Peruvian Industries and Districts
WP/19/## TRADE EXPOSURE, CONSUMPTION INEQUALITY, AND LABOR MARKETS: A STUDY OF PERUVIAN INDUSTRIES AND DISTRICTS by Mumtaz Hussain, Yothin Jinjarak, Gonzalo Salinas IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management. © 2019 International Monetary Fund WP/##/## IMF Working Paper ############ Department Trade exposure, consumption inequality, and labor markets: A study of Peruvian industries and districts Prepared by Mumtaz Hussain, Yothin Jinjarak, Gonzalo Salinas1 Authorized for distribution by ######## June 2019 IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management. Abstract We study spillovers of trade exposure to consumption inequality and labor markets in Peru. Dependent variables are socioeconomic indicators measuring consumption per capita, unemployment, and informality. The policy variable of interest is tariff reduction of a district and its neighboring areas. The weighted tariff is constructed by combining the information of the number of workers in the district involved in economic activity relative to the total number of workers in the district, and the tariff linked to the economic activity. Controlling for education, migration, rural-urban differences, and initial conditions of socioeconomic development and tariff levels, we find a positive association between tariff reduction and consumption per capita, while the results for unemployment and informality are sensitive to empirical specifications.
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