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U.S. Production Technology And The Effects Of Imports On The Demand For Primary Factors

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  • Christis G. Tombazos

Abstract

We employ a unit cost function, in the context of the production theory approach, to estimate the Allen-Uzawa effect of various categories of imports on U.S. primary factors. To circumvent curvature-related problems, often associated with similar studies that do not invoke separability, we combine the global imposition of concavity with a symmetric normalized quadratic representation of the unit cost function (which remains flexible after curvature enforcing reparameterizations). Challenging conventional wisdom, we find that the positive, downstream-production-related, employment effects of the majority of imports are significant enough to produce a detectable net increase in labor demand. © 1998 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

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  • Christis G. Tombazos, 1998. "U.S. Production Technology And The Effects Of Imports On The Demand For Primary Factors," The Review of Economics and Statistics, MIT Press, vol. 80(3), pages 480-483, August.
    • Handle: RePEc:tpr:restat:v:80:y:1998:i:3:p:480-483
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    Cited by:

    1. Christis G. Tombazos, 2010. "Trade and Wage Inequality in a World of Incomplete Diversification," Chapters, in: Noel Gaston & Ahmed M. Khalid (ed.), Globalization and Economic Integration, chapter 8, Edward Elgar Publishing.
    2. Tsionas, Efthymios G. & Christopoulos, Dimitris K., 2003. "Cointegration modeling of interrelated factor demands: With an application to labor-import substitution in the European Union," Journal of Macroeconomics, Elsevier, vol. 25(4), pages 509-526, December.
    3. Alexander Hijzen, 2004. "Trade in Intermediates and the Rise in Wage Inequality in the UK: A GNP Function Approach," Econometric Society 2004 North American Summer Meetings 224, Econometric Society.
    4. Tombazos, Christis G., 1999. "The impact of imports on the demand for labor in Australia," Economics Letters, Elsevier, vol. 62(3), pages 351-356, March.
    5. Huy Quang Vu, 2012. "Imports and the demand for skilled and unskilled labour - the Australian experience," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 15(1), pages 37-55.

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