International Trade and Core Labour Standards

Abstract

The purpose of this paper is to provide a critical review of the current debate and recent literature on several aspects of international core labor standards. We attempt to address two basic issues. One strand of the literature examines the role that international trade plays in mediating international differences in wages, levels of development, labor law and cultural practices. In this context, we examine the theory and evidence concerning the impact of differing labor standards for international trade and whether such trade has implications for the income distribution in OECD countries. We also consider the impact of heterogeneous cross-country labor standards and practices for legal institutions relating to labor standards and industrial relations. In particular, we are interested in whether cross-country differences in labor standards must inevitably give rise to a race to the bottom in labor protections and what any consequent decline in standards might imply for broader ...