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Efficiency Gains from Trade and Labor Market Outcomes

AuthorsFelbermayr, Gabriel; Prat, Julien
Keywordsfirm heterogeneity
search models
trade liberalization
Issue Date2-Dec-2013
PublisherNordic Council of Ministers
CitationNordic Economic Policy Review: Globalization, labour market institutions and wage structure: 45-72 (2013)
AbstractDoes trade liberalization increase domestic unemployment? Does it lead to higher wage inequality? In this article, we draw lessons from combining two canonical frameworks: the heterogeneous firms trade model of Melitz (2003) and the search-and-matching labor market paradigm. We focus on productivity or efficiency gains from trade. We argue that trade liberalization is likely to lower the equilibrium rate of unemployment, but that its effect on wage dispersion is ambiguous. We discuss implications for the conduct of trade and labor market policies
DescriptionCapítulo en: BARTH, Erling; MOENE, Kalle O. Nordic Economic Policy Review: Globalization, labour market institutions and wage structure, Copenhaguen: TemaNord, Nordic Council of Ministers,2013, p.45-72. (TemaNord 2013 ; 587). ISBN 9789289328883. DOI: http://dx.doi.org/10.6027/tn2013-587
Publisher version (URL)http://dx.doi.org/10.6027/tn2013-587
Identifiersdoi: 10.6027/TN2013-514
isbn: 9789289328883
Appears in Collections:(IAE) Libros y partes de libros
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