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Trade, technology, and unemployment: the role of endogenous skill formation

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  • Udo Kreickemeier

Abstract

world, where the two countries (`Europe' and `America') differ in their preferences towards wage inequality. Fair wage considerations compress wage differentials in both countries. European workers are more averse to wage inequality, and Europe is characterized by lower wage differentials and higher unemployment. Allowing for endogenous skill formation, the effects of a globalization shock, global technological change, and a change in the educational capital stock on skill premia and employment levels are derived. In contrast to a model with exogenous factor supplies, international wage and unemployment differentials are affected by global shocks.

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Bibliographic Info

Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 42 (2009)
Issue (Month): 2 (May)
Pages: 639-664

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Handle: RePEc:cje:issued:v:42:y:2009:i:2:p:639-664

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Cited by:
  1. Falvey, Rod & Greenaway, David & Silva, Joana, 2010. "Trade liberalisation and human capital adjustment," Journal of International Economics, Elsevier, vol. 81(2), pages 230-239, July.
  2. Sebastian Benz & Wilhelm Kohler, 2010. "Managerial versus Production Wages: Offshoring, Country Size and Endowments," CESifo Working Paper Series 3292, CESifo Group Munich.

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