Labor Market Power in Developing Countries: Evidence from Colombian Plants

Serie

• CEPR Discussion Papers

Resumen

• How much can employers in low and middle-income countries suppress wages below marginal productivity? Using plant and customs data from Colombia, we exploit pre-determined variation across plants in sales export destination combined with variation in exchange rates to generate plant-specific shocks to marginal revenue productivity and labor demand. We estimate a firm-level labor supply elasticity of around 2.5, implying that workers produce about 40% more than their wage level. Our results indicate that Colombian and US manufacturers have a comparable degree of labor market power.

autores

• Amodio, Francesco
• De Roux, Nicolás

fecha de publicación

• 2021

Área temática

• J42 - Monopsonio; Mercados de trabajo segmentados
• L10 - Estructura de mercado, estrategia empresarial y funcionamiento del mercado: Generalidades
• O14 - Industrialización; Industrias manufactureras y de servicios; Elección de tecnología
• O54 - Estudios económicos globales de países: América Latina; Caribe

Enfoque geográfico

• Colombia  Country
• Estados Unidos  Country
• North America  Continent
• South America  Continent

Líneas de investigación

• Colombia
• export
• labor market power

Issue

• 16180