International Trade and Employment in LabourIntensive Sectors in Iran; the Case of Carpet- Weavers

Most developing countries try to reduce production costs to beable to increase their exports to the competitive international markets.the process of economic globalization has winners and losers. surginginternational trade has lowered the share of iran's labour-intensiveexports, especially persian carpets, in international markets; as theproduction costs of its rival countries are lower.the findings of this research and the results of the survey whichwas conducted in kashan show that rise in international trade hasreduced iran's competitiveness in labour intensive exports and theincreased the share of resource based exports.as, harsh international competition in conquering hand-wovencarpet markets has reduced real wages of carpet-weavers and hasrestructured the labour force of the carpet industry in iran. the middleincome families, who were involved in carpet-weaving for long time,have left the industry and afghan immigrant workers increasinglysubstitute iranian middle class weavers. the estimated econometricmodel also indicates that by increasing real income, many workers leavelow-paid carpet weaving jobs. so, iran's share in international handwovencarpet markets would be lower, if low-paid women and afghanworkers were not concentrated in iran's hand-woven carpet industry.