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Workers'age and the impact of trade shocks

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  • Artuc, Erhan

Abstract

Do trade shocks affect workers differently because of their age? This paper examines the issue by estimating the lifetime mobility of workers based on the sectors in which they work. Using U.S. data, the paper shows that mobility costs rise with a worker's age and years of experience, but stay the same regardless of his or her education level. In addition, using a general-equilibrium simulation of counterfactual trade-liberalization policies in the metal manufacturing sector, the paper shows that trade shocks affect workers with higher mobility costs more, for both winners and losers of the policy shocks. But the effects taper off over a worker's lifetime, especially when they are close to retirement.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6035.

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Date of creation: 01 Apr 2012
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Handle: RePEc:wbk:wbrwps:6035

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Keywords: Economic Theory&Research; Labor Markets; Tertiary Education; Labor Policies; Trade Policy;

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References

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  1. Michael P. Keane & Kenneth I. Wolpin, 1995. "The career decisions of young men," Working Papers, Federal Reserve Bank of Minneapolis 559, Federal Reserve Bank of Minneapolis.
  2. John Kennan & James R. Walker, 2003. "The Effect of Expected Income on Individual Migration Decisions," NBER Working Papers 9585, National Bureau of Economic Research, Inc.
  3. Attanasio, Orazio & Goldberg, Pinelopi K. & Pavcnik, Nina, 2004. "Trade reforms and wage inequality in Colombia," Journal of Development Economics, Elsevier, Elsevier, vol. 74(2), pages 331-366, August.
  4. Erhan Artuc & Shubham Chaudhuri & John McLaren, 2007. "Trade Shocks and Labor Adjustment: A Structural Empirical Approach," NBER Working Papers 13465, National Bureau of Economic Research, Inc.
  5. Rod Falvey & David Greenaway & Joana Silva, . "Trade Liberalisation and Human Capital Adjustment," Discussion Papers 07/34, University of Nottingham, GEP.
  6. Artuc, Erhan, 2013. "PPML estimation of dynamic discrete choice models with aggregate shocks," Policy Research Working Paper Series, The World Bank 6480, The World Bank.
  7. Moritz Ritter, 2012. "Trade and Inequality in a Directed Search Model with Firm and Worker Heterogeneity," DETU Working Papers, Department of Economics, Temple University 1202, Department of Economics, Temple University.
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Cited by:
  1. Artuc, Erhan & McLaren, John, 2012. "Trade policy and wage inequality : a structural analysis with occupational and sectoral mobility," Policy Research Working Paper Series, The World Bank 6194, The World Bank.

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