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Product Market Integration and Wage Formation

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  • M. Andersen, Torben

    ()
    (University of Aarhus)

  • Rose S rense, Jan

    (University of Aarhus)

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    Abstract

    This paper analyses the basic labour market inter-dependencies among coun - tries with intra-industrial trade and imper fectly competitive product and labour markets. The paper stresses two major channels through which increased integration may affect product markets and therefore in turn labour markets. First, market entry becomes easier and/or less costly implying that m o re goods become traded goods. Second, market integration among economies already open to trade may reduce the explicit or implicit trade costs of selling in foreign markets. It is found that the two channels have different implications for wage formation.

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    Bibliographic Info

    Article provided by Center for Economic Integration, Sejong University in its journal Journal of Economic Integration.

    Volume (Year): 15 (2000)
    Issue (Month): ()
    Pages: 281-293

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    Handle: RePEc:ris:integr:0133

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    Web page: http://econo.sejong.ac.kr/
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    Related research

    Keywords: Trade Costs; Intra-industry Trade; Wage Formation;

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    Cited by:
    1. Andersen, Torben M & Sorensen, Allan, 2005. "Product Market Integration, Wages and Inequality," CEPR Discussion Papers 4963, C.E.P.R. Discussion Papers.
    2. Torben Andersen & Jan Skaksen, 2007. "Labour Demand, Wage Mark-ups and Product Market Integration," Journal of Economics, Springer, vol. 92(2), pages 103-135, October.
    3. Andersen, Torben M. & Skaksen, Jan Rose, 2003. "Product Market Integration, Comparative Advantages and Labour Market Performance," IZA Discussion Papers 698, Institute for the Study of Labor (IZA).
    4. Torben M. Andersen, 2003. "Wage formation and European integration," European Economy - Economic Papers 188, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
    5. Moore, Tomoe & Pentecost, Eric J., 2006. "An investigation into the sources of fluctuation in real and nominal wage rates in eight EU countries: A structural VAR approach," Journal of Comparative Economics, Elsevier, vol. 34(2), pages 357-376, June.
    6. Erkki Koskela & Rune Stenbacka, 2001. "Equilibrium Unemployment with Credit and Labour Market Imperfections," CESifo Working Paper Series 419, CESifo Group Munich.
    7. Andersen, Torben M., 2005. "Product market integration, wage dispersion and unemployment," Labour Economics, Elsevier, vol. 12(3), pages 379-406, June.
    8. Andersen, Torben M., 2001. "Product Market Integration, Wage Dispersion and Unemployment," IZA Discussion Papers 279, Institute for the Study of Labor (IZA).
    9. Persyn, Damiaan, 2013. "Union wage demands with footloose firms and agglomeration forces," Regional Science and Urban Economics, Elsevier, vol. 43(1), pages 142-150.
    10. Andersen, Torben M & Sorensen, Allan, 2003. "International Product Market Integration, Rents and Wage Formation," CEPR Discussion Papers 3995, C.E.P.R. Discussion Papers.

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