Globalization, Labor Market Rigidities and Multiple Equilibria
This paper analyses the effects of globalization, stricter intellectual property rights protection and different labor market policies in a dynamic North-South general equilibrium model with non-scale growth. To this aim, we generalize the Schumpeterian product-lifecycle model of Dinopoulos and Segerstrtom (2003) by adding frictional unemployment and firing costs to their framework. We find that the effects on North-South wage inequality, employment and growth depend qualitatively on the level of Northern firing costs. Contrary to the special case of perfect labor market flexibility studied by Dinopoulos and Segerstrom, globalization may not benefit anymore both the South in terms of a relative-wage catch up and the North in terms of a temporary innovation and growth push.
|Date of creation:||Jun 2004|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +45 6550 2233
Fax: +45 6550 1090
Web page: http://degit.sam.sdu.dk/
More information through EDIRC
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.:
- Arnold, Lutz G., 2002. "On the growth effects of North-South trade: the role of labor market flexibility," Journal of International Economics, Elsevier, vol. 58(2), pages 451-466, December.
- Olivier Blanchard & Justin Wolfers, 1999.
"The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence,"
NBER Working Papers
7282, National Bureau of Economic Research, Inc.
- Blanchard, Olivier & Wolfers, Justin, 2000. "The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence," Economic Journal, Royal Economic Society, vol. 110(462), pages C1-33, March.
- Jonas Agell, 2002.
"On the Determinants of Labour Market Institutions: Rent Seeking vs. Social Insurance,"
German Economic Review,
Verein für Socialpolitik, vol. 3(2), pages 107-135, 05.
- Agell, Jonas, 2001. "On the Determinants of Labour Market Institutions: Rent Seeking vs. Social Insurance," Research Papers in Economics 2001:12, Stockholm University, Department of Economics.
- Currie, David, et al, 1999.
"Phases of Imitation and Innovation in a North-South Endogenous Growth Model,"
Oxford Economic Papers,
Oxford University Press, vol. 51(1), pages 60-88, January.
- David Currie & Paul Levine & Joeseph Pearlman & Michael Chui, 1996. "Phases of Imitation and Innovation in a North-South Endogenous Growth Model," School of Economics Discussion Papers 9602, School of Economics, University of Surrey.
- Chui, Michael & Currie, David & Levine, Paul L & Pearlman, Joseph, 1996. "Phases of Imitation and Innovation in a North-South Endogenous Growth Model," CEPR Discussion Papers 1489, C.E.P.R. Discussion Papers.
- Arnold, Lutz G., 2003. "Growth in stages," Structural Change and Economic Dynamics, Elsevier, vol. 14(1), pages 55-74, March.
- Alan V. Deardorff, 2002.
"What Might Globalization's Critics Believe?,"
492, Research Seminar in International Economics, University of Michigan.
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Paul Segerstrom & Elias Dinopoulos, 2004.
"A Theory of North-South Trade and Globalization,"
2004 Meeting Papers
30, Society for Economic Dynamics.
- Federico Etro, 2006. "Political geography," Public Choice, Springer, vol. 127(3), pages 321-343, June.
- Mauro, Luciano & Carmeci, Gaetano, 2003. "Long run growth and investment in education: Does unemployment matter?," Journal of Macroeconomics, Elsevier, vol. 25(1), pages 123-137, March.
- Li, Chol-Won, 2001. "On the Policy Implications of Endogenous Technological Progress," Economic Journal, Royal Economic Society, vol. 111(471), pages C164-79, May.
- Segerstrom, Paul S, 1998. "Endogenous Growth without Scale Effects," American Economic Review, American Economic Association, vol. 88(5), pages 1290-1310, December.
- Wacziarg, Romain & Welch, Karen Horn, 2003.
"Trade Liberalization and Growth: New Evidence,"
1826, Stanford University, Graduate School of Business.
- Chol-Won Li, 2003.
"Endogenous Growth Without Scale Effects: Comment,"
American Economic Review,
American Economic Association, vol. 93(3), pages 1009-1017, June.
- Dinopoulos, Elias & Thompson, Peter, 1998. " Schumpeterian Growth without Scale Effects," Journal of Economic Growth, Springer, vol. 3(4), pages 313-35, December.
- Segerstrom, Paul, 2003. "Naomi Klein and the Anti-Globalization Movement," CEPR Discussion Papers 4141, C.E.P.R. Discussion Papers.
- Lutz G. Arnold, 2002. "On the Effectiveness of Growth-Enhancing Policies in a Model of Growth Without Scale Effects," German Economic Review, Verein für Socialpolitik, vol. 3(3), pages 339-346, 08.
When requesting a correction, please mention this item's handle: RePEc:deg:conpap:c009_020. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jan Pedersen)
If references are entirely missing, you can add them using this form.