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    • Articles and reports: 11F0019M2005258
      Geography: Canada
      Description:

      This paper uses firm-level data from the T2/LEAP to investigate whether the link between tariff changes and employment differed across firms with various productivity and leverage characteristics over the period 1988 to 1994. The results suggest that the combined effect of domestic and U.S. tariff reductions on employment was typically small, but that losses were significantly larger for firms which were less productive. For instance, firms with average productivity in 1988 responded to tariff changes by cutting employment by only 3.6% over the period 1988 to 1994, while lower productivity firms typically shed 15.1% of their workforce over the same period. This paper also indicates that firms which were more heavily in debt downsized more in response to declining domestic tariffs, suggesting that financial constrains became more binding when tariff cuts were implemented. These results suggest that firms with high productivity and low leverage were less likely than others to feel the impact of declining U.S. and domestic tariffs.

      Release date: 2005-06-22

    • Articles and reports: 11F0019M2005259
      Geography: Canada
      Description:

      This article summarizes findings from the research paper entitled: Tariff Reduction and Employment in Canadian Manufacturing, 1988-1994. At the end of the 1980s, Canada and the United States reached an agreement to phase out import tariffs over a 10-year period beginning January 1st, 1989. This tariff reduction scheme was a major centre-piece of the Canada-U.S. Free Trade Agreement (FTA). The implementation of the FTA was followed by a recession, characterized by massive job cuts in manufacturing industries, which led to suggestions that employment losses were related to the reduction of trade barriers. Research on firm output and survival (Gu, Sawchuk and Whewell, 2003; Baggs, 2004) suggests the impact of tariff changes was different across industries and across firms within industries. Using firm-level data, this study investigates the impact of reduced Canadian and U.S. tariffs on Canadian manufacturing employment. The study also asks whether the impact was heterogeneous across firms with various productivity and leverage characteristics.

      Release date: 2005-06-22
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    • Articles and reports: 11F0019M2005258
      Geography: Canada
      Description:

      This paper uses firm-level data from the T2/LEAP to investigate whether the link between tariff changes and employment differed across firms with various productivity and leverage characteristics over the period 1988 to 1994. The results suggest that the combined effect of domestic and U.S. tariff reductions on employment was typically small, but that losses were significantly larger for firms which were less productive. For instance, firms with average productivity in 1988 responded to tariff changes by cutting employment by only 3.6% over the period 1988 to 1994, while lower productivity firms typically shed 15.1% of their workforce over the same period. This paper also indicates that firms which were more heavily in debt downsized more in response to declining domestic tariffs, suggesting that financial constrains became more binding when tariff cuts were implemented. These results suggest that firms with high productivity and low leverage were less likely than others to feel the impact of declining U.S. and domestic tariffs.

      Release date: 2005-06-22

    • Articles and reports: 11F0019M2005259
      Geography: Canada
      Description:

      This article summarizes findings from the research paper entitled: Tariff Reduction and Employment in Canadian Manufacturing, 1988-1994. At the end of the 1980s, Canada and the United States reached an agreement to phase out import tariffs over a 10-year period beginning January 1st, 1989. This tariff reduction scheme was a major centre-piece of the Canada-U.S. Free Trade Agreement (FTA). The implementation of the FTA was followed by a recession, characterized by massive job cuts in manufacturing industries, which led to suggestions that employment losses were related to the reduction of trade barriers. Research on firm output and survival (Gu, Sawchuk and Whewell, 2003; Baggs, 2004) suggests the impact of tariff changes was different across industries and across firms within industries. Using firm-level data, this study investigates the impact of reduced Canadian and U.S. tariffs on Canadian manufacturing employment. The study also asks whether the impact was heterogeneous across firms with various productivity and leverage characteristics.

      Release date: 2005-06-22
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