When Does Trade Hurt? Market, Transition and Developing Economies
This paper argues that labor market distortions in transition and developing economies help explain differential impacts of trade liberalization. We assume that workers differ in ability. In a market economy their earnings depend on their ability. However, earnings are independent of ability due to a common wage set in manufacturing in a transition economy and because of family farms in a developing economy. Our work suggests that trade liberalization without structural reform can have serious adverse effects in transition and developing economies: there can even be mutual losses from trade.
|Date of creation:||Jun 2002|
|Date of revision:|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
References listed on IDEAS
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.:
- Krishna, Kala & Yavas, Cemile, 2001.
"Lumpy Consumer Durables, Market Power, and Endogenous Business Cycles,"
3-01-1, Pennsylvania State University, Department of Economics.
- Kala Krishna & Cemile Yavas, 2004. "Lumpy consumer durables, market power, and endogenous business cycles," Canadian Journal of Economics, Canadian Economics Association, vol. 37(2), pages 375-391, May.
- Kala Krishna & Cemile Yavas, 2001. "Lumpy Consumer Durables, Market Power, and Endogenous Business Cycles," NBER Working Papers 8296, National Bureau of Economic Research, Inc.
- Richard A. Brecher, 1974. "Minimum Wage Rates and the Pure Theory of International Trade," The Quarterly Journal of Economics, Oxford University Press, vol. 88(1), pages 98-116.
- Brecher, Richard A., 1974. "Optimal commercial policy for a minimum-wage economy," Journal of International Economics, Elsevier, vol. 4(2), pages 139-149, May.
- Olivier Blanchard & Michael Kremer, 1997.
The Quarterly Journal of Economics,
Oxford University Press, vol. 112(4), pages 1091-1126.
- Olivier Blanchard & Michael Kremer, 1997. "Disorganization," William Davidson Institute Working Papers Series 38, William Davidson Institute at the University of Michigan.
- Blanchard, O & Kremer, M, 1996. "Disorganization," Working papers 96-30, Massachusetts Institute of Technology (MIT), Department of Economics.
- Blanchard, Olivier & Kremer, Michael R., 1997. "Disorganization," Scholarly Articles 3659691, Harvard University Department of Economics.
- Davis, Donald R, 1998. "Does European Unemployment Prop Up American Wages? National Labor Markets and Global Trade," American Economic Review, American Economic Association, vol. 88(3), pages 478-94, June.
- Kala Krishna & Cemile Yavas, . "Wage Equality in a General Equilibrium Model with Indivisibilities," EPRU Working Paper Series 01-12, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Ng Yew Kwang, 1965. "Why do People Buy Lottery Tickets? Choices Involving Risk and the Indivisibility of Expenditure," Journal of Political Economy, University of Chicago Press, vol. 73, pages 530.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:8995. 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: ()
If references are entirely missing, you can add them using this form.