Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2000-07-31
Number: 00-065/2
Author-Name: Joseph Francois
Author-Email: francois@few.eur.nl
Author-Workplace-Name: Erasmus University Rotterdam, and CEPR
Author-Name: Douglas R. Nelson
Author-Workplace-Name: Murphy Institute of Political Economy
Title: Victims of Progress: Economic Integration, Specialization, and Wages for Unskilled Labor
Abstract: In this paper we demonstrate that intra-industry trade (or FDI)between identical countries could produce theobserved deterioration in the relative wages of unskilled workers.This involves a model of North-Northintegration through either increased trade flows or increased MNE-based production.  Our motivation in this regardis arguments to the effect that trade cannot be responsible for theobserved labour market trends because tradewith developing countries is quantitatively too small to havesignificant labour market effects.   We also introduce arelatively unexploited class of model that possesses attractiveproperties with respect to the explicit incorporationof firm-theoretic considerations in trade models.
Classification-JEL: F16; F15; J31
Keywords: trade and wages; trade and employment; FDI and wages; globalization and employment
File-Url: https://papers.tinbergen.nl/00065.pdf
File-Format: application/pdf
File-Size: 234499 bytes
Handle: RePEc:tin:wpaper:20000065