Demand side considerations and the trade and wages debate:
Recent trade and wages literature focuses on whether trade or technology has been the major source of increases in wage inequality in OECD countries since the 1980s. In this literature, no attention has been paid to demand side considerations. Using a simple heterogeneous goods trade model of the Ar...
Gespeichert in:
| Hauptverfasser: | , |
|---|---|
| Format: | Buch |
| Sprache: | English |
| Veröffentlicht: |
Cambridge, Mass.
2000
|
| Schriftenreihe: | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series
7674 |
| Schlagworte: | |
| Online-Zugang: | Volltext |
| Zusammenfassung: | Recent trade and wages literature focuses on whether trade or technology has been the major source of increases in wage inequality in OECD countries since the 1980s. In this literature, no attention has been paid to demand side considerations. Using a simple heterogeneous goods trade model of the Armington type, and UK data, we show how trade shocks affecting the price of unskilled-intensive goods can be absorbed on the demand side, with little or no impact on relative wage rates. No wage impact occurs if the elasticity of substitution in preferences between imports and import substitutes is one. As this elasticity increases, trade plays an ever larger role in explaining wage inequality changes, and as the elasticity goes below one the sign of the effect changes. We suggest that since many import demand elasticity estimates are in the neighbourhood of one, there is a prima facie case that demand side considerations further lower the significance of trade as an explanation of recent trends in OECD wage inequality -beyond that reported in recent literature. |
| Beschreibung: | 13 S. |
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| 490 | 1 | |a National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |v 7674 | |
| 520 | |a Recent trade and wages literature focuses on whether trade or technology has been the major source of increases in wage inequality in OECD countries since the 1980s. In this literature, no attention has been paid to demand side considerations. Using a simple heterogeneous goods trade model of the Armington type, and UK data, we show how trade shocks affecting the price of unskilled-intensive goods can be absorbed on the demand side, with little or no impact on relative wage rates. No wage impact occurs if the elasticity of substitution in preferences between imports and import substitutes is one. As this elasticity increases, trade plays an ever larger role in explaining wage inequality changes, and as the elasticity goes below one the sign of the effect changes. We suggest that since many import demand elasticity estimates are in the neighbourhood of one, there is a prima facie case that demand side considerations further lower the significance of trade as an explanation of recent trends in OECD wage inequality -beyond that reported in recent literature. | ||
| 650 | 4 | |a Elasticity (Economics) | |
| 650 | 4 | |a Import substitution | |
| 650 | 4 | |a Wage differentials | |
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| 700 | 1 | |a Whalley, John |d 1947- |e Verfasser |0 (DE-588)128956879 |4 aut | |
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| id | DE-604.BV013256471 |
| illustrated | Not Illustrated |
| indexdate | 2024-07-09T18:42:36Z |
| institution | BVB |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-009036333 |
| oclc_num | 44137627 |
| open_access_boolean | 1 |
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| owner_facet | DE-19 DE-BY-UBM DE-521 |
| physical | 13 S. |
| publishDate | 2000 |
| publishDateSearch | 2000 |
| publishDateSort | 2000 |
| record_format | marc |
| series | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| series2 | National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series |
| spelling | Abrego, Lisandro Verfasser aut Demand side considerations and the trade and wages debate Lisandro Abrego ; John Whalley Cambridge, Mass. 2000 13 S. txt rdacontent n rdamedia nc rdacarrier National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 7674 Recent trade and wages literature focuses on whether trade or technology has been the major source of increases in wage inequality in OECD countries since the 1980s. In this literature, no attention has been paid to demand side considerations. Using a simple heterogeneous goods trade model of the Armington type, and UK data, we show how trade shocks affecting the price of unskilled-intensive goods can be absorbed on the demand side, with little or no impact on relative wage rates. No wage impact occurs if the elasticity of substitution in preferences between imports and import substitutes is one. As this elasticity increases, trade plays an ever larger role in explaining wage inequality changes, and as the elasticity goes below one the sign of the effect changes. We suggest that since many import demand elasticity estimates are in the neighbourhood of one, there is a prima facie case that demand side considerations further lower the significance of trade as an explanation of recent trends in OECD wage inequality -beyond that reported in recent literature. Elasticity (Economics) Import substitution Wage differentials Wages Effect of international trade on Whalley, John 1947- Verfasser (DE-588)128956879 aut Erscheint auch als Online-Ausgabe National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series 7674 (DE-604)BV002801238 7674 http://papers.nber.org/papers/w7674.pdf kostenfrei Volltext |
| spellingShingle | Abrego, Lisandro Whalley, John 1947- Demand side considerations and the trade and wages debate National Bureau of Economic Research <Cambridge, Mass.>: NBER working paper series Elasticity (Economics) Import substitution Wage differentials Wages Effect of international trade on |
| title | Demand side considerations and the trade and wages debate |
| title_auth | Demand side considerations and the trade and wages debate |
| title_exact_search | Demand side considerations and the trade and wages debate |
| title_full | Demand side considerations and the trade and wages debate Lisandro Abrego ; John Whalley |
| title_fullStr | Demand side considerations and the trade and wages debate Lisandro Abrego ; John Whalley |
| title_full_unstemmed | Demand side considerations and the trade and wages debate Lisandro Abrego ; John Whalley |
| title_short | Demand side considerations and the trade and wages debate |
| title_sort | demand side considerations and the trade and wages debate |
| topic | Elasticity (Economics) Import substitution Wage differentials Wages Effect of international trade on |
| topic_facet | Elasticity (Economics) Import substitution Wage differentials Wages Effect of international trade on |
| url | http://papers.nber.org/papers/w7674.pdf |
| volume_link | (DE-604)BV002801238 |
| work_keys_str_mv | AT abregolisandro demandsideconsiderationsandthetradeandwagesdebate AT whalleyjohn demandsideconsiderationsandthetradeandwagesdebate |