We examine the importance of institutions and geography for determining workers' wages and the return to capital. These returns to labor and capital are examined through the lens of labor and capital's productivities, which are directly related to the factors' returns. We estimate productivities...

The authors show that estimated productivities of labor and capital, which rationalize trade flows across countries, are related to total factor productivities, which rationalize output differences across countries. They present evidence that these productivities from trade are related to the...