Kiriya Kulkolkarn. Abstract This study provides a picture of immigrant employment in manufacturing of Thailand.
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1 Chulalongkorn Journal of Economics 23, 2011: Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 95 Immigrant-employing Firms in Thai Manufacturing Kiriya Kulkolkarn Abstract This study provides a picture of immigrant employment in manufacturing of Thailand. Productivity and Investment Climate Survey (PICS) of Thailand in 2007 reveals that 19 percent processing industries hire 70 percent of the total of 10,837 immigrants. The average share of Keywords: Immigrant, Manufacturing, Thailand, Firm-level Data * Faculty of Economics, Thammasat University, Thailand.
2 96 Chulalongkorn Journal of Economics 23, Introduction middle income trap. percent and 1.25 percent, respectively. Although study of the impact of immigration modest.
3 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 97 resulting in dramatic increase in productivity. 1 1 The Bracero program was initiated in 1942 for the importation of temporary contract laborers from before it was abolished in 1964.
4 98 Chulalongkorn Journal of Economics 23, 2011 In manufacturing, Quispe-Agnoli and Zavodny (2002) developed a regression This paper aims to provide some stylized facts from the analysis of micro 2. Firm s Decision to Employ Immigrants on technology. Suppose technology is linear such that the production function (x 1,x 2 ) = ax 1 + bx 2 as a result a decision to employ immigrants.
5 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 99 or marginal costs, providing a separate mechanism for size to decrease the have access to more advanced technology and management. to have higher productivity. 3. Immigrant Employment in Thai Manufacturing Thailand Productivity Institution (FTPI) under the supervision of the Ministry of
6 100 Chulalongkorn Journal of Economics 23, 2011 components. 2 percent of 535,732 registered immigrants or 0.6 percent of 1,800,000 registered each employ 9 percent (1,023 immigrants and 992 immigrants, respectively). and electrical appliances each employ 1 percent (116 immigrants, 83 immigrants
7 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 101 appliances. Moreover, the data reveals high concentration of firm in immigrant in food processing to 100 percent in electronic components. employment varies from 40 percent in food processing to 3 percent in electrical as high as 100 percent. Figure 1: Source
8 102 Chulalongkorn Journal of Economics 23, 2011 Figure 2: Source Figure 3: Source
9 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 103 Table 1: Industry No. of Immigrants Immigrant-Native Ratio (%) Mean Max StdDev Mean Max StdDev Food processing Garments Electronic components Electrical appliances Source 4. Immigrant Employment and Firm s Characteristics and Performances measured as operating revenue.
10 104 Chulalongkorn Journal of Economics 23, 2011 productivity mainly resulted from four factors: more capital or machinery VAL i = y m i i l i i y is output measured as operating revenue, m is l captures primarily the impact of technology and investment climate. TFP is Or, SG i = ln(y it y it t stands for time, and y s
11 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 105 summarizes the average value of a particular plant characteristics and performances. Table 3: Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output 498,000, ,300, Age *** *** Multi-plant Computer *** 573, , *** TFP 8,495,754 6,146, ,585 97, *** 210, , *** 85,448 68, ** 250, , * **
12 106 Chulalongkorn Journal of Economics 23, 2011
13 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 107 Table 4: Characteristics/Industry All Total Employment + Output - Age Multi-plant Computer TFP Note 5. What Kinds of Firms Tend to Employ Immigrants together so that their results are estimated in one regression.
14 108 Chulalongkorn Journal of Economics 23, 2011 decrease the chance of employing immigrants include higher foreign share in
15 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 109 Table 5: The Decision to Employ Immigrants: All Industries VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (2.280) (0.0130) (0.0124) (0.0129) (0.0119) (2.773) (0.0169) (0.0152) (0.0158) (0.0143) (11.01) (0.0583) (0.0598) (0.0620) (0.0572) (1.367) ( ) ( ) ( ) ( ) Age * (0.263) ( ) ( ) ( ) ( ) 0.141** ** *** ** ** (0.0598) ( ) ( ) ( ) ( ) *** *** *** *** *** (0.0920) ( ) ( ) ( ) ( ) Computer *** *** *** *** *** (0.134) ( ) ( ) ( ) ( ) (0.0759) ( ) ( ) ( ) ( ) *** *** *** *** *** (4.952) (0.0285) (0.0264) (0.0275) (0.0236) 28.38*** 0.166*** 0.150*** 0.155*** 0.103*** (5.369) (0.0356) (0.0313) (0.0314) (0.0199) Multi-plant (2.902) (0.0177) (0.0149) (0.0160) (0.0127) ln (TFP) e (1.095) ( ) ( ) ( ) ( ) Constant 187.5*** 1.171*** (54.95) (0.310) 1,010 1,010 1,010 1,010 1, Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
16 110 Chulalongkorn Journal of Economics 23, 2011 Table 6: Characteristics/Industry All & Total Employment - Output Age Multi-plant Computer TFP Note at least 4 models.
17 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing Conclusions This study provides a picture of immigrant employment in manufacturing of Thailand. It distinguishes immigrant-employing firms from non-immigrant firms employed 10,837 immigrants. Of all immigrants 37 percent (4031 immigrants) in electronic components, and 1 percent each (116 immigrants, 83 immigrants and and electrical appliances. The average share of immigrants in total employment of each firm is appliances. Moreover, the data reveals high concentration of firm in immigrant
18 112 Chulalongkorn Journal of Economics 23, 2011
19 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 113 controlled machinery. References Canada, Journal of Human Resources, 30, 4, Industrial and Labor Relations Review, 44, 2, Industrial and Labor Relations Review, 43, Oxford Review of Economic Policy, 24, 3, Quarterly Journal of Economics, 111, Journal of Economic Perspectives, 9, 2, University of Chicago Press. Thailand. Chulalongkorn Journal of Economics, vol: 19/1 April 2007, p The Financial Times. Journal of Economic Surveys, 19, 3, Center for Immigration Studies.
20 114 Chulalongkorn Journal of Economics 23, 2011 Journal of Economic Surveys, 22, 1, Capital, and Productivity. Immigration Studies. Tella, A. (2006). Productivity and immigration. The Washington Times.
21 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 115 Appendix Table 2.0: Data Summary: All Industries Variable Obs Mean Std.Dev. Min Max Output ,000, ,520,000, , ,300,000, Total Employment , , ,102, , ,000, , , ,816, Age Computer , , , ,307, Multi-plant TFP ,061, ,100, , ,000, Table 2.1: Data Summary: Food Processing Variable Obs Mean Std.Dev. Min Max Output ,000, ,700,000, ,075, ,200,000, Total Employment , , , ,419, , ,200, , , ,816, Age Computer , , , , Multi-plant TFP ,200, ,900, , ,000,000.00
22 116 Chulalongkorn Journal of Economics 23, 2011 Table 2.2: Variable Obs Mean Std.Dev. Min Max Output ,000, ,000, ,253, ,810,000, Total Employment , , , , ,444, , , ,127, Age Export Foreign Owner Computer Vintage Capital , , , ,307, Sale Growth Multi-plant TFP 149 6,152, ,580, , ,200, Table 2.3: Data Summary: Garments Variable Obs Mean Std.Dev. Min Max Output ,000, ,000, , ,290,000, Total Employment , , , , ,706, , , , Age Export Foreign Owner Computer Vintage Capital , , , , Sale Growth Multi-plant TFP 142 5,100, ,452, , ,400,000.00
23 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 117 Table 2.4: Variable Obs Mean Std.Dev. Min Max Output ,000, ,920,000, ,893, ,100,000, Total Employment , ,063, ,797, , ,000, , , ,800, Age Computer , , , , Multi-plant TFP ,100, ,500, , ,000, Table 2.5: Data Summary: Electronic Components Variable Obs Mean Std.Dev. Min Max Output 65 1,370,000, ,100,000, ,746, ,900,000, Total Employment , , , , , ,213, , , ,615, Age Computer , , , , Multi-plant TFP 65 3,241, ,478, , ,800,000.00
24 118 Chulalongkorn Journal of Economics 23, 2011 Table 2.6: Data Summary: Electrical Appliances Variable Obs Mean Std.Dev. Min Max Output ,000, ,980,000, ,899, ,120,000, Total Employment , , ,374, , ,392, , , , , Age Computer , , , , Multi-plant TFP , , , , Table 2.7: Variable Obs Mean Std.Dev. Min Max Output ,000, ,680,000, ,971, ,300,000, Total Employment , , ,302, , ,500, , , ,656, Age Computer , , , , Multi-plant TFP , , , ,204,679.00
25 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 119 Table 2.8: Variable Obs Mean Std.Dev. Min Max Output ,400, ,000, , ,000,000, Total Employment , , , , ,505, , , , Age Computer , , , , Multi-plant TFP , , , ,007, Table 2.9: Variable Obs Mean Std.Dev. Min Max Output ,000, ,000, , ,360,000, Total Employment , , , , ,905, , , ,398, Age Export Foreign Owner Computer Vintage Capital , , , , Sale Growth Multi-plant TFP 82 5,176, ,118, , ,900,000.00
26 120 Chulalongkorn Journal of Economics 23, 2011 Table 3.1: Difference between Non-migrant Firms and Migrant-employing Firms: Food Processing Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age * Multi-plant * Computer ** TFP * Table 3.2: Difference between Non-migrant Firms and Migrant-employing Firms: Textiles Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age Multi-plant * Computer ** * * TFP *
27 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 121 Table 3.3: Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age ** Multi-plant * Computer * TFP Table 3.4: Components Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age Multi-plant Computer TFP * **
28 122 Chulalongkorn Journal of Economics 23, 2011 Table 3.5: Difference between Non-migrant Firms and Migrant-employing Firms: Electronic Components Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age Multi-plant Computer TFP Table 3.6: Appliances Characteristics p-value Total Employment Output *** Age *** Multi-plant Computer TFP ** ***
29 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 123 Table 3.7: Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age ** * Multi-plant Computer * TFP * Table 3.8: Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment Output Age ** Multi-plant *** Computer TFP
30 124 Chulalongkorn Journal of Economics 23, 2011 Table 3.9: Characteristics Non-migrant Firms Migrant-employing Firms p-value Total Employment ** Output Age * Multi-plant Computer ** TFP *
31 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 125 Table 5.1: The Decision to Employ Immigrants: Food Processing VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (60.46) (0.353) (0.469) (0.483) (0.395) (93.80) (0.546) (0.729) (0.752) (0.615) (83.83) (0.399) (0.664) (0.674) (0.586) * * (6.313) (0.0363) (0.0528) (0.0537) (0.0437) Age (0.753) ( ) ( ) ( ) ( ) (0.174) ( ) ( ) ( ) ( ) ** *** ** ** ** (0.334) ( ) ( ) ( ) ( ) Computer (0.796) ( ) ( ) ( ) ( ) e-05 (0.200) ( ) ( ) ( ) ( ) * (15.92) (0.103) (0.124) (0.125) (0.112) 33.95*** 0.232*** 0.279** 0.280** 0.221** (12.31) (0.0807) (0.132) (0.131) (0.106) Multi-plant ** (13.33) (0.0224) (0.0890) (0.0931) (0.0772) ln (TFP) (92.63) (0.545) (0.721) (0.743) (0.609) Constant 319.3* (176.7) (1.136) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
32 126 Chulalongkorn Journal of Economics 23, 2011 Table 5.2: VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) ** *** (16.52) (0.0970) (0.176) (0.186) (0.141) *** *** * * * (28.25) (0.176) (0.309) (0.325) (0.249) (23.24) (0.179) (0.178) (0.190) (0.158) * (2.811) (0.0161) (0.0218) (0.0230) (0.0197) Age *** (0.469) ( ) ( ) ( ) ( ) (0.152) ( ) ( ) ( ) ( ) (0.298) ( ) ( ) ( ) ( ) Computer * *** * * * (0.595) ( ) ( ) ( ) ( ) e e-05 (0.191) ( ) ( ) ( ) ( ) * * ** * (14.20) (0.108) (0.107) (0.110) (0.0998) 32.60* * 0.225* 0.171* (17.83) (0.149) (0.126) (0.128) (0.0999) Multi-plant ** (7.593) (0.0510) (0.0756) (0.0797) (0.0642) ln (TFP) 88.18*** 0.661*** 0.518* 0.576* 0.427* (28.37) (0.175) (0.309) (0.325) (0.248) Constant 296.0* 2.022* (151.7) (1.133) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
33 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 127 Table 5.3: The Decision to Employ Immigrants: Garments VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) * * * * (29.56) (0.142) (0.124) (0.135) (0.105) * (44.76) (0.248) (0.193) (0.209) (0.164) (32.84) (0.174) (0.136) (0.153) (0.113) (4.868) (0.0262) (0.0197) (0.0215) (0.0163) Age (1.073) ( ) ( ) ( ) ( ) * * * (0.195) ( ) ( ) ( ) ( ) (0.724) ( ) ( ) ( ) ( ) Computer (0.557) ( ) ( ) ( ) ( ) ** *** ** *** ** (0.293) ( ) ( ) ( ) ( ) (15.36) (0.0590) (0.0695) (0.0734) (0.0655) 30.86** 0.140* 0.150** 0.159** 0.128** (15.03) (0.0721) (0.0621) (0.0627) (0.0516) Multi-plant (0.0466) ln (TFP) (44.34) (0.244) (0.192) (0.207) (0.162) Constant (181.4) (0.793) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
34 128 Chulalongkorn Journal of Economics 23, 2011 Table 5.4: VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) * (130.7) (0.273) (0.173) (0.154) (0.178) * (187.3) (0.395) (0.245) (0.220) (0.250) * (216.5) (0.308) (0.289) (0.264) (0.291) (8.215) (0.0219) ( ) ( ) ( ) Age e e e-05 (0.507) ( ) ( ) ( ) ( ) e e e-05 (0.151) ( ) ( ) (6.01e-05) ( ) e e e-06 (0.0947) ( ) (6.53e-05) (3.90e-05) (6.96e-05) Computer e e e-05 (0.108) ( ) ( ) (9.14e-05) ( ) e e e-05 (0.109) ( ) ( ) (7.81e-05) ( ) ** (5.549) (0.0731) (0.0164) (0.0123) (0.0168) (13.61) (0.0797) (0.0167) (0.0131) (0.0181) Multi-plant (5.239) (0.0267) ( ) ( ) ( ) ln (TFP) * (189.4) (0.388) (0.249) (0.223) (0.256) Constant 312.5* 2.411** (159.7) (0.917) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
35 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 129 Table 5.5: The Decision to Employ Immigrants: Electronic Components and Electrical Appliances VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (16.34) (0.0239) (0.0123) (0.0133) (0.0121) (19.87) (0.0339) (0.0180) (0.0215) (0.0174) (63.76) (0.0861) (0.0501) (0.0543) (0.0467) (12.78) (0.0229) (0.0117) (0.0115) (0.0125) Age (2.605) ( ) ( ) ( ) ( ) 0.811* (0.461) ( ) ( ) ( ) ( ) e-05 (0.381) ( ) ( ) ( ) ( ) Computer (0.834) ( ) ( ) ( ) ( ) e e e-05 (0.594) ( ) ( ) ( ) ( ) (30.50) (0.0475) (0.0254) (0.0271) (0.0251) (38.11) (0.0789) (0.0294) (0.0317) (0.0305) Multi-plant (13.57) (0.0319) (0.0109) (0.0121) (0.0105) ln (TFP) (9.024) (0.0306) (0.0103) (0.0122) ( ) Constant (409.6) (0.630) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
36 130 Chulalongkorn Journal of Economics 23, 2011 Table 5.6: VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (7.955) (0.0547) (0.0629) (0.0657) (0.0573) (28.67) (0.216) (0.228) (0.239) (0.208) (37.31) (0.235) (0.286) (0.306) (0.260) (8.724) (0.0635) (0.0694) (0.0726) (0.0644) Age (0.425) ( ) ( ) ( ) ( ) 0.171* ** ** ** ** (0.0971) ( ) ( ) ( ) ( ) (0.141) ( ) ( ) ( ) ( ) Computer * * * * (0.183) ( ) ( ) ( ) ( ) (0.120) ( ) ( ) ( ) ( ) (8.663) (0.0667) (0.0711) (0.0726) (0.0687) 22.04** * 0.132* 0.118* (9.299) (0.0836) (0.0754) (0.0794) (0.0665) Multi-plant (5.936) (0.0310) (0.0383) (0.0416) (0.0350) ln (TFP) (28.96) (0.213) (0.229) (0.240) (0.208) Constant (108.8) (0.853) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
37 Kiriya K.: Immigrant-employing Firms in Thai Manufacturing 131 Table 5.7: VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (20.24) (0.111) (2.73e-09) (0) (0) (47.89) (0.281) (4.60e-09) (0) (0) (46.27) (0.177) (1.25e-10) (0) (0) (12.41) (0.0726) (2.09e-09) (0) (0) Age (1.135) ( ) (8.23e-11) (0) (0) 0.755*** ** 0 (0.247) ( ) (6.59e-11) (0) (0) *** ** (27.28) ( ) (4.88e-09) (0) (0) Computer *** (0.834) ( ) (1.52e-10) (0) (0) ** ** 0 (0.272) ( ) (5.96e-11) (0) (0) (14.12) (0.0979) (6.22e-10) (0) (0) (27.86) (0.154) (3.26e-09) (0) (0) Multi-plant 55.67*** 0.176*** 0 0*** 0 (17.66) (0.0640) (5.80e-09) (0) (0) ln (TFP) (47.25) (0.289) (5.68e-09) (0) (0) Constant 326.3* (169.9) (1.170) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
38 132 Chulalongkorn Journal of Economics 23, 2011 Table 5.8: VARIABLES Tobit LP Logit Probit Cloglog ln (Employment) (11.79) (0.170) (0.114) (0.133) (0.106) (22.19) (0.355) (0.215) (0.253) (0.200) (17.29) (0.376) (0.169) (0.200) (0.155) (1.841) (0.0262) (0.0205) (0.0228) (0.0200) Age e e e (0.221) ( ) ( ) ( ) ( ) (0.0837) ( ) ( ) ( ) ( ) (0.0734) ( ) ( ) ( ) ( ) Computer (0.139) ( ) ( ) ( ) ( ) (0.0568) ( ) ( ) ( ) ( ) (4.959) (0.0727) (0.0494) (0.0566) (0.0478) 14.54** * * (6.637) (0.117) (0.0843) (0.102) (0.0769) Multi-plant (2.479) (0.0746) (0.0274) (0.0305) (0.0260) ln (TFP) (22.09) (0.366) (0.216) (0.254) (0.200) Constant (62.25) (1.253) Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1
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