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Globalization and Labor Market Dynamics

Author

Listed:
  • John McLaren

    (Department of Economics, University of Virginia, Charlottesville, Virginia 22904)

Abstract

Historically, the trade research field has usually ignored dynamic adjustment of workers, but a recent wave of work has developed a rich set of theoretical and empirical tools to analyze this factor. Empirical approaches have ranged from reduced-form regressions to the structural estimation of underlying parameters, which is necessary to understand welfare effects. A major distinction is that between models that do and those that do not allow for unobserved heterogeneity across workers; these models are useful for different purposes. Consistent findings across methods and countries indicate that costs of switching sectors and occupations are high and that both switching costs and option value are crucial in computing the welfare effects of globalization for workers.

Suggested Citation

  • John McLaren, 2017. "Globalization and Labor Market Dynamics," Annual Review of Economics, Annual Reviews, vol. 9(1), pages 177-200, September.
  • Handle: RePEc:anr:reveco:v:9:y:2017:p:177-200
    DOI: 10.1146/annurev-economics-063016-103720
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    Citations

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    Cited by:

    1. Kohei Takeda, 2022. "The geography of structural transformation: Effects on inequality and mobility," CEP Discussion Papers dp1893, Centre for Economic Performance, LSE.
    2. Lorenzo Caliendo & Luca David Opromolla & Fernando Parro & Alessandro Sforza, 2021. "Goods and Factor Market Integration: A Quantitative Assessment of the EU Enlargement," Journal of Political Economy, University of Chicago Press, vol. 129(12), pages 3491-3545.
    3. Giorgia Giovannetti & Enrico Marvasi & Arianna Vivoli, 2021. "The asymmetric effects of 20 years of tariff reforms on Egyptian workers," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(1), pages 89-130, April.
    4. Zi, Yuan, 2020. "Trade Liberalization and the Great Labor Reallocation," CEPR Discussion Papers 14490, C.E.P.R. Discussion Papers.
    5. Justin R. Pierce & Peter K. Schott & Cristina Tello-Trillo, 2022. "Trade Liberalization and Labor-Market Outcomes: Evidence from US Matched Employer-Employee Data," Working Papers 22-42, Center for Economic Studies, U.S. Census Bureau.
    6. Andreas M. Fischer & Philipp Herkenhoff & Philip Sauré, 2023. "Identifying Chinese supply shocks: Effects of trade on labor markets," Review of International Economics, Wiley Blackwell, vol. 31(4), pages 1476-1507, September.
    7. Giorgia Giovannetti & Enrico Marvasi & Arianna Vivoli, 2020. "The asymmetric effects of twenty years of tariff reforms on Egyptian workers," Working Papers LuissLab 20156, Dipartimento di Economia e Finanza, LUISS Guido Carli.
    8. Douglas A. Irwin, 2019. "Does Trade Reform Promote Economic Growth? A Review of Recent Evidence," Working Paper Series WP19-9, Peterson Institute for International Economics.
    9. Brussevich, Masha, 2018. "Does trade liberalization narrow the gender wage gap? The role of sectoral mobility," European Economic Review, Elsevier, vol. 109(C), pages 305-333.
    10. Chopra, ParveshK., 2022. "A Systems Model to Measure Labour Market Dynamics," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 75(4), pages 465-518.

    More about this item

    Keywords

    trade; offshoring; globalization; wages; dynamic adjustment;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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