nach oben

Erschienen in:

2022 | OriginalPaper | Buchkapitel

Trade, Unemployment and Inequality in Product Variety Models—An Analytical Survey

verfasst von : Sugata Marjit, Meghna Dutta

Erschienen in: Studies in International Economics and Finance

Verlag: Springer Singapore

Einloggen

Aktivieren Sie unsere intelligente Suche, um passende Fachinhalte oder Patente zu finden.

search-config

KI-gestützte Suche

Aus

Abstract

There have been a significant body of theoretical and empirical work done on the effects of trade on employment and wage inequality. However, a close study of the extant literature shows that most of the work has been done within the aegis of factor-biased and sector-biased effects of factor returns due to trade. Specific factor market characteristics of the countries and their interaction owing to their trade linkages have not been explicitly studied especially in a trade model with product variety. In this work, apart from extensively discussing the literature on each of these aspects, we trace out briefly the impact of trade, entrepreneurial finance and presence of a fixed minimum wage policy on wage inequality in a one-sector Krugman-type model.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

über 102.000 Bücher
über 537 Zeitschriften

aus folgenden Fachgebieten:

Automobil + Motoren
Bauwesen + Immobilien
Business IT + Informatik
Elektrotechnik + Elektronik
Energie + Nachhaltigkeit
Finance + Banking
Management + Führung
Marketing + Vertrieb
Maschinenbau + Werkstoffe
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

über 67.000 Bücher
über 340 Zeitschriften

aus folgenden Fachgebieten:

Bauwesen + Immobilien
Business IT + Informatik
Finance + Banking
Management + Führung
Marketing + Vertrieb
Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Jetzt informieren

Vorheriges Kapitel Revisiting Literature on Trade Facilitation (TF) in the Context of COVID-19 and South Asia

Nächstes Kapitel Trade Balance and Need of National Reserves in Face with Aging Population

Openness of trade helps international knowledge spillovers, which in turn raises the relative demand for skilled labour and pushes up wage inequality in developing countries. New technologies obtained using skilled workers diffuse to the less-skilled workers to some extent resulting in an increase in the demand for less-skilled labour. The net effect of these two kinds of knowledge spillovers on the equilibrium wage inequality in the developing country is the skill discrepancy effect.

In a relatively unskilled-labour abundant country, openness of trade can lead to a decrease in wage premium. This is called price effect.

The other way is to consider efficiency wage unemployment as in Matusz (1996).

Acemoglu, D. (1999). Changes in unemployment and wage inequality: An alternative theory and some evidence. American Economic Review, 89, 1258–1278.CrossRef

Acemoglu, D. (2002). Directed technical change. Review of Economic Studies, 69, 781–810.CrossRef

Addison, J., McKinley, T., Blackburn, L., & Cotti, C. D. (2009). Do minimum wages raise employment? Evidence from the U.S. retail‐trade sector. Labour Economics, 16(4), 397–408.

Ahn, T., & Arcidiacono, P. (2004). Minimum wages and positive employment effects in general equilibrium. Duke University.

Anwar, S. (2006a). Factor mobility and wage inequality in the presence of specialisation-based external economics. Economics Letters, 93(1), 88–93.CrossRef

Anwar, S. (2006b). Provision of public infrastructure, foreign investment and welfare in the presence of specialisation-based external economies. Economic Modelling, 23, 142–156.CrossRef

Anwar, S. (2009). Wage inequality, welfare and downsizing. Economics Letters, 103, 75–77.CrossRef

Bai, X., Chatterjee, A., Krishna, K., & Ma, H. (2018). Trade and minimum wages in general equilibrium: Theory and evidence. NBER Working Paper No. 24456. National Bureau of Economic Research.

Banga, R. (2005). Liberalisation and wage inequality in India. ICRIER Working Paper 156, March, ICRIER.

Bastos, P., & Straume, O. R. (2010). Globalization, product differentiation and wage inequality. University of Nottingham Research Paper No. 2010/03.

Behrman, J., Birdsall, N., & Szekely, M. (2000). Economic reform and wage differentials in Latin America. BID Working Paper 435, October, Inter-American Development Bank.

Beladi, H., & Marjit, S. (1996). An analysis of rural-urban migration and protection. Canadian Journal of Economics, 29(4), 930–940.CrossRef

Beladi, H., Chaudhuri, S., & Yabuuchi. S. (2008). Can international factor mobility reduce wage inequality in a dual economy? Review of International Economics, 16(5), 893–903

Beyer, H., Rojas, P., & Vergara, R. (1999). Trade liberalization and wage inequality. Journal of Development Economics, 59, 103–123.CrossRef

Borjas, G., & Ramey, V. (1993). Foreign competition, market power and wage inequality: Theory and evidence. NBER Working Paper 4556, December, Cambridge, MA.

Bound, J., & Johnson, G. (1992). Changes in the structure of wages in the 1980s: An evaluation of alternative explanations. American Economic Review, 82, 371–392.

Brecher, R. A., & Gross, T. (2018). A minimum wage model of unemployment and growth: The case of a backward-bending demand curve for labor. International Journal of Economic Theory, 15(3), 297–309.CrossRef

Card, D., & Krueger, A. B. (1993). Minimum wages and employment: A case study of the New Jersey and Pennsylvania fast food industries. American Economic Review, 84(4), 772–793.

Cengiz, D., Dube, A., Lindner, A., & Zipperer, B. (2019). The effect of minimum wages on low‐wage jobs: Evidence from the United States using a bunching estimator. NBER Working Paper No. 25434. National Bureau of Economic Research.

Chaudhuri, S., & Yabuuchi, S. (2007). Economic liberalization and wage inequality in the presence of labour market imperfection. International Review of Economics and Finance, 16, 592–603.CrossRef

Das, S. P. (2002). foreign direct investment and the relative wage in a developing economy’. Journal of Development Economics, 67(1), 55–77.CrossRef

Das, S. P. (2003). Trade and relative wage in a global economy. Review of International Economics, 11(2), 397–411.CrossRef

Davis, D. R. (1998). Does European unemployment prop up American wages? National labor markets and global trade. American Economic Review, 88(3), 478–494.

Deardorff, A., & Staiger, R. (1988). An interpretation of the factor content of trade. Journal of International Economics, 24, 93–107.CrossRef

Dev, M. (2000). Economic liberalization and employment in South Asia. Economic and Political Weekly, 40–51.

Dube, A., Lester, T. W., & Reich, M. (2010). Minimum wage effects across state borders: Estimates using contiguous counties. Review of Economics and Statistics, 92(4), 945–964.CrossRef

Dube, A., Lester, T. W., & Reich, M. (2016). Minimum wage shocks, employment flows, and labor market frictions. Journal of Labor Economics, 34(3), 663–704.CrossRef

Dutta, M., Kar, S., & Marjit, S. (2013). Product variety, finite changes and wage inequality. Economic Modelling, 35, 610–613.CrossRef

Feenstra, R. C., & Hanson, G. H. (1996). Globalization, outsourcing, and wage inequality. The American Economic Review, 86(2), 240–245.

Feenstra, R. C., & Hanson, G. H. (1997). Foreign direct investment and relative wages: Evidence from Mexico’s Maquiladoras. Journal of International Economics, 42, 371–394.CrossRef

Feenstra, R. C., & Hanson, G. H. (2003). Global production sharing and rising inequality: A survey of trade and wages. In E. K. Choi, & J. Harrigan (Eds.), Handbook of international trade. Blackwell Publishers.

Gittings, R. K., & Schmutte, I. M. (2015). Getting handcuffs on an octopus: Minimum wages, employment, and turnover. ILR Review, 69(5), 1133–1170.CrossRef

Glazer, A., & Ranjan, P. (2003). Preference heterogeneity, wage inequality, and trade. Journal of International Economics, 60, 455–469.CrossRef

Gorg, H., & Strobl, E. (2002). Relative wages, openness and skill-biased technological change. IZA Discussion Paper Series 596, October. IZA.

Green, F., Dickerson, A., & Arbache, J. (2001). A picture of wage inequality and the allocation of labour through a period of trade liberalization: The case of Brazil. World Development, 29(11), 1923–1939.CrossRef

Gustafsson, P., & Segerstrom, P. (2010). Trade liberalization and productivity growth. Review of International Economics, 18(2), 207–228.

Hanson, G. H., & Harisson, A. (1999). Trade liberalization and wage inequality in Mexico. Industrial and Labor Economics Review, 52, 271–288.CrossRef

Helpman, E. (2011). Understanding global trade. Harvard University Press.CrossRef

Isgut, A. E. (2001). What’s different about exporters? Evidence from Colombian manufacturing. Journal of Development Studies, 37, 57–82.CrossRef

Jones, R.W. (1971). A three factor model in trade, theory and history. In J. N. Bhagwati, R.W. Jones, R.A. Mundell, & J. Vanek (Eds.), Trade, balance of payments and growth: Papers in international economics in honor of Charles P. Kindleberger. North‐Holland.

Jones, R. W., & Marjit, S. (2003). Economic development, trade and wages. German Economic Review, 4(1), 1–17.CrossRef

Kar, S., & Beladi, H. (2004). Skill formation and international migration: Welfare perspective of developing countries. Japan and the World Economy, 16, 35–54.CrossRef

Katz, L., Loveman, G. W., & Blanchflower, D. G. (1992). A comparison of changes in the structure of wages in four OECD countries. NBER Working Paper.

Kohler, W. (2004). A specific-factors view on outsourcing. North American Journal of Economics and Finance, 12(1), 31–53.CrossRef

Krugman, P. (1981). Intraindustry specialization and the gains from trade. The Journal of Political Economy, 89(5), 959–973.CrossRef

Lawrence, R. Z. (1994). Trade, Multinationals and Labour. NBER Working Paper No. 4836.

Leamer, E. (2000). What is the use of factor contents? Journal of International Economics, 50(1).

Marjit, S. (2020). A new Ricardian model of trade, growth and inequality. CESifo Working Paper #8689–2020. November 2020. Germany. ISSN 2364-1428.

Marjit, S., & Acharyya, R. (2003). International trade, wage inequality and the developing economy—A general equilibrium approach. Springer-Verlag.CrossRef

Marjit, S., Basu, A., & Veeramani, C. (2019). Growth gains from trade. CESifo Working Paper No 7905.

Marjit, S., Beladi, H., & Chakrabarti, A. (2004). Trade and wage inequality in developing countries. Economic Inquiry, 42(2), 295–303.CrossRef

Marjit, S., Ganguly, S., Acharyya, R. (2020). Minimum wage, trade and unemployment in general equilibrium. International Journal of Economic Theory, 1–14.

Matusz, S. J. (1996). International trade, the division of labor, and unemployment. International Economic Review, 37(l), 71–84.

Marjit, S., & Kar, S. (2005). Emigration and wage inequality. Economics Letters, 88(1), 141–145.CrossRef

Marjit, S., & Mondal, B. (2016). international trade, migration and unemployment—The role of informal sector. Economics and Politics, 28(1), 8–22.CrossRef

Marjit, S., & Mondal, B. (2017). Virtual trade between separated time zones and growth. International Journal of Economic Theory, 13(02), 171–183.CrossRef

Marjit, S., & Das, G. (2020). The new ricardian specific factor model. CESifo Working Paper No. 9052.

Neumark, D., & Wascher, W. L. (2008). Minimum wages. MIT Press.CrossRef

Piketty, T. (2013). Capital in the twenty-first century. Belknap Press of Harvard University Press.

Ricardo, D. (1817). Principles of political economy and taxation (1st ed.). John Murray.

Wang, J., & Gunderson, M. (2012). Minimum wage effects on employment and wages: Difference-in-difference estimates from eastern China. International Journal of Manpower, 33(8), 860–876.CrossRef

Wang, M., Fang, C., & Huang, L. (2009). International knowledge spillovers and wage inequality in developing countries. Economic Modelling, 26(6), 1208–1214.CrossRef

Wood, A. (1998). Globalisation and the rise in labor market inequalities. The Economic Journal, 108, 1463–1482.CrossRef

Wood, A. (1997). Openness and wage inequality in developing countries—The Latin American challenge to East Asian conventional wisdom. World Bank Research Observer, 33–57.

Titel: Trade, Unemployment and Inequality in Product Variety Models—An Analytical Survey
verfasst von: Sugata Marjit
Meghna Dutta
Verlag: Springer Singapore
Buch: Studies in International Economics and Finance
Print ISBN: 978-981-16-7061-9

Electronic ISBN: 978-981-16-7062-6

Copyright-Jahr: 2022
DOI: https://doi.org/10.1007/978-981-16-7062-6_16

Springer Professional

Abstract

Bitte loggen Sie sich ein, um Zugang zu Ihrer Lizenz zu erhalten.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Springer Professional "Wirtschaft"

Premium Partner