TRADE AND SKILLED-UNSKILLED WAGE GAP IN A MODEL WITH DIFFERENTIATED GOODS

There is a continuing debate about whether international trade is responsible for the observed skilled-unskilled wage gap. In this paper we present a general equilibrium trade model with differentiated goods. We begin with an analytical model and show how changes in relative factor returns can be decomposed into changes in commodity prices, changes in the trade balance, and changes in the factor endowment Then we use a computable general equilibrium (CGE) trade model calibrated to the U.S. economy in 1982 to analyze the effects of these shocks, as well as technology changes, observed in the U.S. in the 1980's.


Issue Date:
2002
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/16280
Total Pages:
49
JEL Codes:
F11; F14; F15
Series Statement:
TMD Discussion Paper
96




 Record created 2017-04-01, last modified 2017-08-24

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)