Trade and Labor-Allocation: Evidence from Sectoral Embodied Labor Transfer between China and Africa

Abstract

Under the influence of international trade, labor flow not only exists in the waves of international labor migration but is also embodied in international products and services. This paper focused on members of the China–Africa Cooperation Forum (FOCAC). We computed and analyzed the sectoral embodied labor transfer between China and Africa from 2000 to 2015 based on the Multiregional Input-Output Method. Our results are as follows: (1) Both China and Africa play roles as labor suppliers in the global supply chain. By ameliorating the trade structure, both China and Africa can better utilize their labor surplus. (2) China and Africa share complementarity in sectoral labor allocation. In short, the embodied labor transfer via international trade between China and Africa has, to some extent, relieved the labor shortage on both sides. (3) Africa has transformed into a net exporter of industrial labor since 2011. By analyzing the embodied labor flow from the global perspective, this paper beats a new path in depicting the effect of international trade on labor allocation, enriches the evaluation of embodied labor transfer between China and Africa, and also provides a beneficial supplement to Multiregional Input-Output analysis in the field of factor flows.

Keywords

• FOCAC
• multiregional input-output
• embodied labor flow
• resource allocation