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Wages, Profits, and Rent-Sharing in an Open Economy

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  • L. Josh Bivens

Abstract

This paper examines the link between international trade and labor market bargaining power. It reviews simple theories of rent-sharing in closed and open economies. Earlier studies on the issue of rent-sharing implicitly assume a closed economy. This assumption may provide some misleading results, especially for studying current developments in the US labor market. Empirical results suggest that the apparent decline in labor's bargaining power in US manufacturing may be attributable to growing international integration.

Suggested Citation

  • L. Josh Bivens, 2006. "Wages, Profits, and Rent-Sharing in an Open Economy," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(1), pages 69-83.
    • Handle: RePEc:taf:irapec:v:20:y:2006:i:1:p:69-83
    DOI: 10.1080/02692170500362678
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    References listed on IDEAS

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    1. David G. Blanchflower & Andrew J. Oswald, 1995. "The Wage Curve," MIT Press Books, The MIT Press, edition 1, volume 1, number 026202375x, April.
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    4. Adrian Wood, 1997. "How Trade Hurt Unskilled Workers," Palgrave Macmillan Books, in: Jitendralal Borkakoti & Chris Milner (ed.), International Trade and Labour Markets, chapter 7, pages 140-168, Palgrave Macmillan.
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    8. William R. Cline, 1997. "Trade and Income Distribution," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 58, January.
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    Cited by:

    1. Robert A. Blecker, 2012. "Stolper–Samuelson Revisited: Trade And Distribution With Oligopolistic Profits," Metroeconomica, Wiley Blackwell, vol. 63(3), pages 569-598, July.

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