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Comparative Advantage and Skill-Specific Unemployment

Title data

Larch, Mario ; Lechthaler, Wolfgang:
Comparative Advantage and Skill-Specific Unemployment.
In: The B.E. Journal of Economic Analysis & Policy. Vol. 11 (2011) Issue 1 .
ISSN 1935-1682
DOI: https://doi.org/10.2202/1935-1682.2673

Abstract in another language

We introduce unemployment and endogenous selection of workers into different skill-classes in a trade model with two sectors and heterogeneous firms. This allows us to study the distributional consequences and the skill-specific unemployment effects of trade liberalization. We show that the gains from trade will be distributed very unequally. While unskilled workers loose in terms of real wages and employment levels in the skilled labor intensive sector, skilled workers loose in terms of real wages and unemployment levels in the unskilled labor intensive sector. However, the inequality of workers between sectors is much larger for skilled labor than for unskilled labor. On average, unemployment among unskilled workers increases when a skill-abundant country opens up to trade.

Further data

Item Type: Article in a journal
Refereed: Yes
Keywords: comparative advantage; heterogeneous firms; labor market frictions; unemployment; trade liberalization
Subject classification: F11, F12, F16, J64, L11
Institutions of the University: Faculties > Faculty of Law, Business and Economics > Department of Economics > Lehrstuhl Volkswirtschaftslehre VI: Empirische Wirtschaftsforschung
Faculties > Faculty of Law, Business and Economics > Department of Economics > Lehrstuhl Volkswirtschaftslehre VI: Empirische Wirtschaftsforschung > Lehrstuhl für Volkswirtschaftslehre VI: Empirische Wirtschaftsforschung - Univ.-Prof. Dr. Mario Larch
Faculties
Faculties > Faculty of Law, Business and Economics
Faculties > Faculty of Law, Business and Economics > Department of Economics
Result of work at the UBT: Yes
DDC Subjects: 300 Social sciences > 330 Economics
Date Deposited: 15 Oct 2015 08:41
Last Modified: 15 Oct 2015 08:41
URI: https://eref.uni-bayreuth.de/id/eprint/16664