Liberalized Trade Policy and Inequality: Evidence from Post-Multi-Fibre Arrangement India and Some 皇冠体育apporetical Issues
Abstract
皇冠体育app phased elimination of the Multi-Fibre Arrangement has been one of the most compelling trade policy reforms of the early twenty-first century, and has brought in significant changes in the industrial structures of the countries of the global south. 皇冠体育app textile and clothing industry is the largest foreign exchange earner and the largest employment provider in India. We show that since the withdrawal of the quota, the industry has witnessed unprecedented concentration of firm-level activities, size-wise as well as state-wise, thereby creating some sort of inequality. Moreover, we also show that the aggregate wage bill of export-oriented firms in India actually rose during this period. However, the aggregate state-level wage bill falls as the profit level rises for the industry. We have also provided a brief analytical exercise to point out conditions under which such a global policy could well raise labourers鈥� income and generate more employment.
Citation
Kar, S.; Kar, M. Liberalized Trade Policy and Inequality: Evidence from Post-Multi-Fibre Arrangement India and Some 皇冠体育apporetical Issues. UNU-WIDER, Helsinki, Finland (2015) 16 pp. [WIDER Working Paper No. 2015/007]