Trade Liberalisation, Process and Product Innovation, and Relative Skill Demand
The interaction between trade liberalisation, product and process innovation, and relative skill demand is analysed in a model of international oligopoly. Lower trading barriers increase the degree of foreign competition. The competing enterprises respond by investing more aggressively in lowering marginal costs of production. Moreover, firms reduce the substitutability of their products through additional investment in product innovation. The paper also shows that the relative demand for skilled workers may increase as a result.
|Date of creation:||Jan 2007|
|Date of revision:|
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Web page: http://sfb649.wiwi.hu-berlin.de
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- Haaland, Jan I. & Kind, Hans Jarle, 2008.
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NBER Working Papers
11627, National Bureau of Economic Research, Inc.
- David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2005. "Trends in U. S. Wage Inequality: Re-Assessing the Revisionists," Harvard Institute of Economic Research Working Papers 2095, Harvard - Institute of Economic Research.
- Pia Weiss, 2003.
"Adoption of Product and Process Innovations in Differentiated Markets: The Impact of Competition,"
Review of Industrial Organization,
Springer, vol. 23(3_4), pages 301-314, December.
- Pia Weiss, 2003. "Adoption of Product and Process Innovations in Differentiated Markets: The Impact of Competition," Review of Industrial Organization, Springer, vol. 23(3), pages 301-314, December.
- J.Peter Neary, 2003.
"Globalisation and Market Structure,"
DNB Staff Reports (discontinued)
100, Netherlands Central Bank.
- Rosenkranz, Stephanie, 2003. "Simultaneous choice of process and product innovation when consumers have a preference for product variety," Journal of Economic Behavior & Organization, Elsevier, vol. 50(2), pages 183-201, February.
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