MACRO-ECONOMETRIC MODELS OF SUPPLY AND DEMAND: INDUSTRY, TRADE AND WAGES IN 6 COUNTRIES, 1960-2012

We analyse the impact of industry on non industrial production, as well as its effect on wages and employment in 6 OECD countries: France, Germany, Italy, Spain, the United Kingdom and the United States for the period 1960-2012. Our approach to macro-econometric modelling have into account both demand and supply sides, including not only the effects of primary inputs but also those of intermediate inputs (domestic and imported). We present some estimated equations, and analysis of causality, with a panel of those countries. We show that excessive delocalization of industry, for 2003-2012, and austerity policies, for 2009-2012, have had a negative effect on wages and development. The main conclusion is that industrialized countries should make compatible their foreign trade policy with domestic development, avoiding strong and unsustainable trade deficits.