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Trade, Technology and Labor Markets: General Equilibrium Perspectives


  • Tyers, Rod

    () (The Australian National University)

  • Duncan, Ron

    (The Australian National University)


This paper summarizes the state of the debate on the effects of "globalization" and spontaneous technical change on wages and, in this context, describes the results from a recent study of the links between trade, technical change and labor market behavior. These new results show that comparatively minor generalization of the standard Heckscher-Ohlin-Samuelson model of trading countries substantially moderates the Stolper-Samuelson factor reward changes stemming from trade refonn. in part for this reason, results from a global general equilibrium analysis suggest that the direct effects of increased openness are a comparatively minor explanator of the observed shifts in labor demand and that skilled-labor-using technical change would appear most important. Of course, part of that technical change may itself be in response to international competition. Any protectionist response against developing countries, driven by concerns about wage inequality or unemployment, is shown to be counteroductive.

Suggested Citation

  • Tyers, Rod & Duncan, Ron, 1999. "Trade, Technology and Labor Markets: General Equilibrium Perspectives," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 14, pages 226-264.
  • Handle: RePEc:ris:integr:0104

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    Cited by:

    1. Tyers, Rod, 2015. "International effects of China's rise and transition: Neoclassical and Keynesian perspectives," Journal of Asian Economics, Elsevier, vol. 37(C), pages 1-19.
    2. Rod Tyers & Iain Bain & Jahnvi Vedi, 2006. "The global implications of freer skilled migration," PGDA Working Papers 1006, Program on the Global Demography of Aging.
    3. Greenaway, David & Nelson, Douglas, 2000. "The Assessment: Globalization and Labour-Market Adjustment," Oxford Review of Economic Policy, Oxford University Press, vol. 16(3), pages 1-11, Autumn.
    4. Patrick Laplagne & Peter Marshall & Susan Stone, 2001. "The role of technology in determining skilled employment: an economywide approach," Labor and Demography 0108001, EconWPA.
    5. Jordan Shan, 1999. "Immigration and Unemployment: New evidence from Australia and New Zealand," International Review of Applied Economics, Taylor & Francis Journals, vol. 13(2), pages 253-260.

    More about this item


    trade; wages; technology;

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials


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