Foreign Direct Investment, Non-traded Goods and Real Wages
Using a three-sector general equilibrium model with non-traded goods, we investigate the impact of foreign direct investment on the real wages of skilled and unskilled workers. We show that foreign direct investment increases the real wages of skilled and unskilled workers, but widens the gap between the two under plausible conditions.
|Date of creation:||23 Dec 2008|
|Date of revision:|
|Publication status:||Forthcoming in Pacific Economic Review.|
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