CEPII, Recherche et Expertise sur l'economie mondiale
Trade Liberalization, Collective Bargaining and Workers: Wages and Working Conditions


Bastien Alvarez
Gianluca Orefice
Farid Toubal

 Points clés :
  • Using large scale data on workers, we analyse the impact of trade liberalization and of the erosion of collective bargaining on workers' wage, employment and working condition.
  • We use the accession of Eastern Europe countries in 2004 and 2007 to assess the impact of the adoption of Western European MFN tariff schemes and of preferential trade agreements on workers' wage, employment and working condition.
  • We show that import tariffs liberalization reduces workers' wages. The deterioration of working conditions is mostly driven by increased labor demand due to the improvement of Eastern countries' international market access. The erosion of collective bargaining worsens wages and working conditions.

 Résumé :
Using large scale data on Eastern European workers, we show significant and sizable deteriorations of their wages and working conditions in regions that faced large tariff liberalization and strong erosion of collective bargaining over the process of accession to the European Union. Import tariffs liberalization reduces workers' wages. The deterioration of working conditions is mostly driven by increased labor demand due to the improvement of Eastern countries' international market access. The erosion of collective bargaining worsens wages and working conditions.


 Mots-clés : Trade Liberalization | Working Conditions | Wages | Labor Market Institutions | Eastern Europe | E.U. Enlargement

 JEL : F15, F16, J30, J51, J81
CEPII Working Paper
N°2021-02, April 2021

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