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1. Trade, Migration, and the Place Premium: Mexico and the United States

Author:
Raymond Robertson, Davide Gandolfi, and Timothy Halliday
Publication Date:
03-2015
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Large wage differences between countries (“place premiums”) are well documented. Theory suggests that factor price convergence should follow increased migration, capital flows, and commercial integration. All three have characterized the relationship between the United States and Mexico over the last 25 years. This paper evaluates the degree of wage convergence between these countries during the period 1988 and 2011. We match survey and census data from Mexico and the United States to estimate the change in wage differentials for observationally identical workers over time. We find very little evidence of convergence. What evidence we do find is most likely due to factors unrelated to US-Mexico integration. While migration and trade liberalization may reduce the US-Mexico wage differential, these effects are small when compared to the overall wage gap.
Topic:
World Trade Organization
Political Geography:
United States and Mexico

2. Globalization, Wages, and Working Conditions: A Case Study of Cambodian Garment Factories

Author:
Cael Warren and Raymond Robertson
Publication Date:
06-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
We use a comprehensive data set of working conditions and wage compliance in Cambodia's exporting garment factories to explore (1) the impact of foreign ownership on wages and working conditions, (2) whether the relationship between wages and working conditions within these exporting factories more closely resembles efficiency wage or compensating differential theory, and (3) whether the wage-working conditions relationship differs between domestically owned and foreign-owned firms. We find that foreign ownership increases compliance on both wages and working conditions, contradicting the contention that higher wages in foreign-owned firms compensate workers for worse working conditions. In addition, we find a robust positive relationship between wages and working conditions in the sample as a whole, suggesting that efficiency wages or a similar theory more accurately explains the behavior of these exporting firms than compensating differentials.
Topic:
Development, Industrial Policy, and Labor Issues
Political Geography:
Cambodia and Southeast Asia

3. Better Factories Cambodia: An Instrument for Improving Industrial Relations in a Transnational Context

Author:
Raymond Robertson and Arianna Rossi
Publication Date:
06-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Globalization of production has created an environment for labor-management relations that involves international actors and spans countries, going beyond the boundaries of the traditional workspace. The dramatic changes brought about by globalization led to the emergence of new cross-border forms of industrial relations. This paper analyses the case of the International Labour Organization's Better Factories Cambodia (BFC) project as a transnational instrument to create the institutional space for industrial relations in Cambodia. Based on the principle of social dialogue among the social partners (the national Government and workers' and employers' organizations) as well as with global buyers, BFC's multistakeholder approach reaches beyond the workplace and may be a key instrument of industrial relations because it bridges the gap between the sphere of production and that of consumption. The empirical results reveal some of the particular strengths of the program.
Topic:
Development, Globalization, Industrial Policy, International Trade and Finance, and Labor Issues
Political Geography:
Cambodia and Southeast Asia