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Cambridge Journal of Economics 28:153-171 (2004)
Cambridge Journal of Economics, Vol. 28, No. 2, © Cambridge Political Economy Society 2004; all rights reserved

Global apparel production and sweatshop labour: can raising retail prices finance living wages?

Robert Pollin, Justine Burns and James Heintz*

Address for correspondence: Robert Pollin, Department of Economics and Political Economy Research Institute (PERI), University of Massachusetts-Amherst, Amherst, MA 01002, USA; email: pollin{at}econs.umass.edu

This paper provides some empirical evidence on issues raised by the global anti-sweatshop movement. We first consider the relationship between wage and employment growth, finding no consistent trade-off between them. We then measure the share of labour costs in the production of garments in the US and Mexico. We find that the retail price increases necessary to absorb the costs of raising wages substantially are small, well within the range of price increases that polls suggest US consumers are willing to pay. We close by considering some implications of these results.

Key Words: Global sweatshop labour • Empirical analysis

JEL classifications: F0, J3, O19

Manuscript received April 26, 2002;
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