Author: Duc Anh Dang / Publishing Institution: Economic Research Institute for ASEAN and East Asia (ERIA)

Author:: Thu Thu Vu and Duc Anh Dang
Publication Date:: 08-2020
Content Type:: Working Paper
Institution:: Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:: Advanced machines and technology replace workers through automation. However, capital–labour substitution need not reduce aggregate labour demand, as it induces simultaneous contrasting effects within industries. To explore these effects, we examine the relationship between employment in Vietnamese manufacturing firms and imported capital goods in 2011–2017. To solve the problem of potential endogeneity and measurement errors, we used Association of Southeast Asian Nations (ASEAN) imported capital goods as an instrument variable for imported capital goods in Viet Nam. We found that imported capital goods do not displace employment and even increase employment and labour productivity. The impacts of imported advanced technology are more pronounced in large firms. More imported technology increases labour productivity in state-owned enterprises and the number of workers in large firms and firms in industrial zones. However, the increase in the level of employment is lower in industries and firms intensively using machines.
Topic:: Development, Science and Technology, Employment, and Imports
Political Geography:: Asia and Vietnam

Author:: Duc Anh Dang and Vuong Ahn Dang
Publication Date:: 12-2020
Content Type:: Working Paper
Institution:: Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:: Using the Small and Medium Enterprise Survey in Vietnam and three proxies of innovation, we study the impact of firm innovation on on-the-job training in the manufacturing sector from 2007 through 2015. To address potential measurement errors and omitted variable problems, we use the average level of innovation in the same sector in other districts as an instrument for firms’ innovations. We find that firms provide additional training for existing workers when introducing new technology, and high-value-added firms provide additional training for existing workers. Moreover, government assistance may not be the main reason that encourages firms to provide training. The results also show that firms hire more skilled workers when implementing innovations.
Topic:: Development, Training, Innovation, and Skilled Labor
Political Geography:: Asia and Vietnam

Author:: Duc Anh Dang
Publication Date:: 08-2019
Content Type:: Working Paper
Institution:: Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:: The formation of global value chains (GVCs) has reshaped production processes across countries. This paper investigates the relationship between GVCs and firms’ employment by using panel data on Vietnamese small manufacturing firms for 2005–2011. The results suggest that increased foreign value added in exports results in higher wages, increased productivity, and a greater share of production workers in domestic small and medium-sized enterprises. In addition, it brings about a lower share of professionals and makes smaller firms retrain their existing workers. At the same time, domestic value added in the export of intermediate products has negative impacts on employment and increases wages, particularly in medium-sized firms. All of these may come from the increased competition for labour from larger firms.
Topic:: International Cooperation, Labor Issues, Trade, and Global Value Chains
Political Geography:: Asia and Vietnam

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