International trade regulation and job creation
Winters, L. Alan
- Publisher: Bonn: Institute for the Study of Labor (IZA)
F66 | trade regulation | H | F13 | F16 | protection | employment | tariffs
Trade regulation can create jobs in the sectors it protects or promotes, but almost always at the expense of destroying a roughly equivalent number elsewhere in the economy. At a product-specific or micro level and in the short term, controlling trade could reduce the offending imports and save jobs, but for the economy as a whole and in the long term, this position has neither theoretical support nor empirical evidence in its favor. Given that protection may have otherâ€”usually adverseâ€”effects, understanding the difficulties in using it to manage employment is important for economic policy.