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.|
|Contact details of provider:|| Postal: 3565 Old Main Hill, Logan, UT 84322-3565|
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- Katz, L.F. & Murphy, K.M., 1991.
"Changes in Relative Wages, 1963-1987: Supply and Demand Factors,"
Harvard Institute of Economic Research Working Papers
1580, Harvard - Institute of Economic Research.
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- Paul Krugman & Robert Lawrence, 1993. "Trade, Jobs, and Wages," NBER Working Papers 4478, National Bureau of Economic Research, Inc.
- Edward E. Leamer, 1996. "In Search of Stolper-Samuelson Effects on U.S. Wages," NBER Working Papers 5427, National Bureau of Economic Research, Inc.
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