Regional Manufacturing Wages: Dancing to the Tune of Trade Shocks
AbstractFirms generally choose to locate their production where profits are maximized. As costs affect profits, trade-offs between two marginal costs - employees' wages and transport costs - may be important for decisions regarding location. Wages tend to be greater in industrial centres and decrease as transport costs increase. Trade shocks might impact regional wage disparities by making foreign markets, for example, relatively more attractive for firms than domestic markets. This paper tests these two hypotheses by using regional Brazilian data. Results corroborate that regions with higher transport costs present lower wages, and that trade shocks affect these regional wage disparities.
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Bibliographic InfoPaper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number 0046.
Date of creation: Apr 2010
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Web page: http://www.spatialeconomics.ac.uk/SERC/publications/default.asp
Economic geography; trade shocks; manufacturing wages;
Find related papers by JEL classification:
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-11-20 (All new papers)
- NEP-GEO-2010-11-20 (Economic Geography)
- NEP-URE-2010-11-20 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- André Rodríguez-Pose, 2001.
"Strategies of Waste: Bidding Wars in the Brazilian Automobile Sector,"
International Journal of Urban and Regional Research,
Wiley Blackwell, vol. 25(1), pages 134-154, 03.
- Rodríguez-Pose, Andrés & Arbixb, Glauco, 2000. "Strategies Of Waste: Bidding Wars In The Brazilian Automobile Sector," ERSA conference papers ersa00p505, European Regional Science Association.
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