"A copublication of the International Labour Organization and the World Bank."

Includes statistical tables.

Includes bibliographical references.

Foreword -- Acknowledgments -- About the contributors -- Abbreviations. Overview : Key messages -- South Asian paradox -- A new approach -- Effect of an increase in exports on local labor market outcomes -- Policies to spread the gains from exports -- Notes -- References. 1 The South Asian paradox : Key messages -- Introduction into global value chains -- Trade and growth: a virtuous cycle -- Potential South Asian gains from greater export orientation -- What the South Asian paradox portends -- Notes -- References. 2 Labor market challenges and export patterns in South Asia : Key messages : Introduction -- Labor market conditions and policy priorities -- Trends in South Asian trade -- Conclusion -- Annex 2A: informality -- Annex 2B: job creation in Bangladesh, Pakistan, and Sri Lanka -- Annex 2C: wage regressions for India -- Notes -- References. 3 The methodology : Key messages -- Conceptual underpinnings -- Literature review of methodology -- Quantifying a positive demand shock to exports: the case of India -- Trade exposure index -- Conclusion -- Annex 3A: trade exposure -- Notes -- References. 4 How export shocks affect local labor markets : Key messages -- Introduction -- How exports have a bigger impact in some states -- How our results compare with others -- Export shocks and labor markets in Sri Lanka -- Conclusion -- Annex 4A: detailed regression results -- Notes -- References. 5 Spreading the labor market gains from exports : Key messages -- Introduction -- Option 1: increasing the scale of exports -- Option 2: changing the composition of exports to help disadvantaged groups -- Option 3: changing the composition of the workforce to help disadvantaged groups -- Suggestions for tackling obstacles to higher exports -- Conclusion -- Annex 5A: the impact of different types of export shocks on specific groups in India and Sri Lanka -- Annex 5B: examples of trade adjustment assistance programs -- Notes -- References. Appendix A Literature review: trade and local labor markets : How trade affects labor market outcomes -- Location, location, location: why local labor markets matter -- Notes -- References. Appendix B Entangled workers and shared prosperity in South Asian labor markets: construction of databases : General -- Bangladesh -- India -- Sri Lanka -- Notes. Appendix C Developed economies. Appendix D Developing economies.

Very few studies focus on the growth of labor market opportunities that follow from exports. Entangled is one of the first to systematically examine the localized effects of long-run export growth in South Asia. The basic premise is that adjustment costs matter. If adjustment costs matter, then we would expect to see significant and persistent differences in wages across industries and regions. We would expect to see that exporting industries and regions tend to pay higher wages and that these differences would only slowly dissipate over time (if at all). We would expect to see that increases in exports would increase the demand for workers. An increase in demand for workers could increase either wages, employment, or both, depending on the ability and willingness of workers to switch industries and regions.If workers face high adjustment costs, the increase in labor demand from exports would be associated with higher wage growth, but not necessarily higher employment growth because workers would not move into expanding industries. As a result, firms would have to raise wages to attract the workers they need. Since expanding takes more time than contracting, we would expect to see the strongest positive wage effects over the longest time horizon because exports take longer to affect labor markets than import competition. The report evaluate these predictions using data from India, Sri Lanka, and Bangladesh. The results are consistent with the presence of very significant worker-level adjustment costs in South Asia and suggest that the gains from exports to date have still been modest.-- Provided by publisher.