International trade's effect on the labor market: How does it affect wages?
Casual observation suggests that internationally competitive sectors have higher wages than uncompetitive sectors. There are two possible reasons for this relationship. First, greater import and export shares can influence wages. Second, there are characteristics of internationally competitive sectors, regardless of trade shares, which influence wages. The study shows that trade can influence wages by changing the elasticity of labor demand and by changing profits which affects wages in a rent sharing environment. The study also divides the manufacturing product market into three sectors: (1) high-tech, (2) a common technology sector whose technology is found throughout the world and (3) the natural resource intensive sector. In general, high-tech sectors are internationally competitive while the other two sectors are not. Efficiency wage considerations suggest that the high-tech sector should pay higher wages.
Year of publication: |
1991
|
---|---|
Authors: | Partridge, Mark Dale |
Other Persons: | Hendricks, W. (contributor) |
Subject: | Labor |
Saved in:
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