Essays on International Trade and Environmental Economics

My dissertation consists of two essays in international trade and environmental economics. In the first essay, which consists of three substantial parts, I investigate whether internationalization can address the problem of female informality in the developing countries’ labor markets. In the first part, I examine the impact of exports and industrial zones on women's informality. In the second part, I investigate whether Foreign Direct Investment (FDI) can reduce women's informality. Additionally, I look at whether the effect of FDI is heterogeneous due to the respective gender norms prevalent within FDI source countries. In the third part, I examine whether results from part I and part II change when export and FDI are studied together in a joint specification. To measure female informality in the firms, I use an index based on women's share in total labor and women's share in informal labor. Using Vietnam's firm level data, I find evidence that foreign-owned firms and firms located in industrial zones reduce female informality. I do not find conclusive results for the effect of the firms’ export status on women's informality. I control for endogeneity issues using estimated total factor productivity, fixed effects at various levels, and heteroscedasticity generated instrument. My results are robust to multiple specifications and multiple sub-samples of the data.

The second essay investigates the importance of environmental policy uncertainty. Based on existing newspaper-based approaches, I construct a measure of environmental policy uncertainty using the frequency of articles mentioning uncertainties related to environmental policies. I use this measure as a proxy for environmental policy uncertainty to investigate its impact on macro and firm level economic variables. I find that environmental policy uncertainty is significant at both macro and firm level. More specifically, I find that the environmental policy uncertainty is linked with fall in aggregate industrial production. Furthermore, I find that it causes increase in firm-level uncertainty and decrease in firm-level investment of firms active in industries sensitive to environmental policies.