Exporting Sweatshops? Evidence from Myanmar

Friday, 9 September, 2016
Abstract: 
There is a long-standing debate over the impact of global trade on workers and firms in developing countries. In this paper, Tanaka investigates the causal effect of exporting on working conditions and firm performance in Myanmar. This analysis draws on a new survey she conducted on Myanmar manufacturing firms from 2013 to 2015. Tanaka uses the rapid opening of Myanmar to foreign trade after 2011 alongside identification strategies that exploit product, geographic and industry variations to obtain causal estimates of the impact of trade. She finds that exporting has large positive impacts on working conditions in terms of improved fire safety, health-care, union recognition, and wages. Her results also indicate that exporting increases firm sales, employment, management practice scores, and the likelihood of receiving a labor audit, which is typically required by foreign buyers.
Number of pages: 
1