Analysing the effects of labour standards on US export performance. A time series approach with structural change

The empirical effects of different measures of labour standards on the export performance of the United States are analysed using annual data for the period 1950-1998, applying a time series approach based on the structural change literature. Hence, a model with endogenous breaks is estimated following the methodology proposed by Bai and Perron (Econometrica, 66, 47-78, 1998). The results show that the labour standards, represented by the number of hours worked, the rate of occupational injuries and the unionization rate, are all very important to explain the behaviour of exports for the United States. In particular, it is found that low labour standards may both improve or lead to a deterioration in export performance.