Labor Market Effects of Trade and FDI:Recent Advances and Research Gaps

This paper pursues three aims. First, we provide a review of current theoretical advanceswhich pertain to the relationship between trade, FDI and labor markets. We do so under thefollowing (not mutually exclusive) headings: (1) slicing-up the value added chain and the turnto a task-based approach, (2) firm heterogeneity and labor markets, (3) complex offshoring(integration) and sourcing strategies and (4) location of firms and labor markets. Second, weoverview existing empirical work covering the labor market effects of trade and FDI. Finally,we identify and summarize the existing research gaps and thereby we highlight promisingavenues for future research....