Sharing the Costs: The impact of trade reform on capital and labor in Morocco

Janet Currie, Ann Harrison

Research output: Chapter in Book/Report/Conference proceedingChapter


We examine the impact of recent trade reforms. Although employment in the average private sector manufacturing firm was unaffected, there were significant employment losses to exporters and highly affected firms. Parastatals increased employment by hiring low-paid temporary workers. Many firms did not adjust wages or employment. We examine two possible explanations. First, barriers to labor market mobility could have impeded adjustment. Second, we develop a model of labor demand which allows for imperfect competition and endogenous technological change. Our results suggest that although labor markets were flexible, many firms cut profit margins and raised productivity rather than reducing employment.

Original languageEnglish (US)
Title of host publicationWorld Scientific Studies in International Economics
EditorsAnn E Harrison, Keith E Maskus
PublisherWorld Scientific
Number of pages28
StatePublished - Jul 1 2022
Externally publishedYes

Publication series

NameWorld Scientific Studies in International Economics
ISSN (Print)1793-3641

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Political Science and International Relations


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