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Author: Rafael Dix-Carneiro Publisher: ISBN: Category : Free trade Languages : en Pages : 22
Book Description
We develop a specific-factors model of regional economies that includes two types of workers, skilled and unskilled. The model delivers a simple equation relating trade-induced local shocks to changes in local skill premia. We apply the methodology to Brazil's early 1990s trade liberalization and find statistically significant but modest effects of liberalization on the evolution of the skill premium between 1991 and 2010. The methodology uses widely available household survey data and can easily be applied to other countries and liberalization episodes.
Author: Rafael Dix-Carneiro Publisher: ISBN: Category : Free trade Languages : en Pages : 22
Book Description
We develop a specific-factors model of regional economies that includes two types of workers, skilled and unskilled. The model delivers a simple equation relating trade-induced local shocks to changes in local skill premia. We apply the methodology to Brazil's early 1990s trade liberalization and find statistically significant but modest effects of liberalization on the evolution of the skill premium between 1991 and 2010. The methodology uses widely available household survey data and can easily be applied to other countries and liberalization episodes.
Author: James Harrigan Publisher: ISBN: Category : Economics Languages : en Pages : 48
Book Description
We propose a theory that rising globalization and rising wage inequality are related because trade liberalization raises the demand for highly competitive skill-intensive firms. In our model, only the lowest-cost firms participate in the global economy exactly along the lines of Melitz (2003). In addition to differing in their productivity, firms in our model differ in their skill intensity. We model skill-biased technology as a correlation between skill intensity and technological acumen, and we estimate this correlation to be large using firm-level data from Chile in 1995. A fall in trade costs leads to both greater trade volumes and an increase in the relative demand for skill, as the lowest-cost/most-skilled firms expand to serve the export market while less skill-intensive non-exporters retrench in the face of increased import competition. This mechanism works regardless of factor endowment differences, so we provide an explanation for why globalization and wage inequality move together in both skill-abundant and skill-scarce countries. In our model countries are net exporters of the services of their abundant factor, but there are no Stolper-Samuelson effects because import competition affects all domestic firms equally.
Author: Seyed Ali Madani Zadeh Publisher: ISBN: 9781303228964 Category : Languages : en Pages : 137
Book Description
This paper is concerned about addressing a question that has become critical in international trade, during the past three decades: 'What explains the worldwide increase in skill premiums following international trade integration and increasingly globalized economies'? I propose a new theory to address this question by presenting, testing, and quantifying a new empirically consistent framework of firm organization. In this model, I show how trade liberalization will result in reallocation of high skilled workers within an industry towards more productive firms and exporters. Specifically, it induces both old and new exporters to choose a higher degree of labor specialization within high-skilled or low-skilled workers, to reduce their marginal costs, and to evolve into more skill-intensive entities. I further demonstrate how these internal organizational amendments directly affect skill intensity and the skill premium in a general equilibrium setting. Lastly, I calibrate this model to Mexican data to actually quantify the rise in skill premiums after trade-integrations.
Author: Roberto Bonfatti Publisher: ISBN: Category : Capital market Languages : en Pages : 0
Book Description
An interesting puzzle is that trade liberalization in the 1980s and 1990s has been associated with a sharp increase in the skill premium in both developed and developing countries. This is in contrast with neoclassical theory, according to which trade should increase the relative return of the relatively abundant factor. We develop a simple model of trade with capital market imperfections, and show that trade can increase the skill premium in both the North and the South, and both in the short run as well as in the long run. We show that trade with a skill-intensive economy has two effects: it reduces the skilled wage, and thus discourages non talented agents out of the skilled labor force; and it reduces the cost of subsistence, thus allowing the talented offspring of unskilled workers to go to school. This compositional effect has a positive effect on the observed skill premium, possibly strong enough to counterweight the decrease in the skilled wage.
Author: Paolo Epifani Publisher: World Bank Publications ISBN: Category : Comercio regional Languages : en Pages : 76
Book Description
Reviews the micro-level evidence on the effects of trade and investment liberalization in the developing world. He focuses, in particular, on the effects of the 1991 trade reform in India since it provides an excellent controlled experiment in which the effects of a drastic trade regime change can be measured. His main findings are: 1) There is evidence of trade-induced productivity gains (in this respect, however, India is an exception. 2) These gains mainly stem from intra-industry reallocation of resources among firms with different productivity levels. 3) The gains are larger in import-competing sectors. 4) There is no evidence of significant scale efficiency gains. Unilateral trade liberalization is often associated with a reduced scale efficiency. 5) There is evidence of a pro-competitive effect of trade liberalization. 6) There is no evidence either of learning-by-exporting effects or of beneficial spillover effects from foreign-owned to local firms active in the same sectors. 7) There is evidence, however, of positive vertical spillovers from foreign direct investment. 8) There is evidence of skill upgrading induced either by technology imports or by trade-induced reallocations of market shares in favor of plants with higher skill-intensity. 9) There is no evidence of trade-induced increases in labor demand elasticities. But direct evidence suggests that trade exposure raises wage volatility. 10) There is no evidence of substantial employment contraction in import-competing sectors.
Author: Rafael Dix-Carneiro
Author: Rafael Dix-Carneiro
Author: James Harrigan
Author: 
Author: Mary Amiti
Author: 
Author: Seyed Ali Madani Zadeh
Author: Roberto Bonfatti
Author: Paolo Epifani
Author: Joy Mazumdar
Author: Nina Pavcnik