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Workers'age and the impact of trade shocks

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  • Artuc, Erhan

Abstract

Do trade shocks affect workers differently because of their age? This paper examines the issue by estimating the lifetime mobility of workers based on the sectors in which they work. Using U.S. data, the paper shows that mobility costs rise with a worker's age and years of experience, but stay the same regardless of his or her education level. In addition, using a general-equilibrium simulation of counterfactual trade-liberalization policies in the metal manufacturing sector, the paper shows that trade shocks affect workers with higher mobility costs more, for both winners and losers of the policy shocks. But the effects taper off over a worker's lifetime, especially when they are close to retirement.

Suggested Citation

  • Artuc, Erhan, 2012. "Workers'age and the impact of trade shocks," Policy Research Working Paper Series 6035, The World Bank.
  • Handle: RePEc:wbk:wbrwps:6035
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    References listed on IDEAS

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    1. Moritz Ritter, 2015. "Trade and inequality in a directed search model with firm and worker heterogeneity," Canadian Journal of Economics, Canadian Economics Association, vol. 48(5), pages 1902-1916, December.
    2. John Kennan & James R. Walker, 2011. "The Effect of Expected Income on Individual Migration Decisions," Econometrica, Econometric Society, vol. 79(1), pages 211-251, January.
    3. Attanasio, Orazio & Goldberg, Pinelopi K. & Pavcnik, Nina, 2004. "Trade reforms and wage inequality in Colombia," Journal of Development Economics, Elsevier, vol. 74(2), pages 331-366, August.
    4. Falvey, Rod & Greenaway, David & Silva, Joana, 2010. "Trade liberalisation and human capital adjustment," Journal of International Economics, Elsevier, vol. 81(2), pages 230-239, July.
    5. Carl Davidson & Lawrence Martin & Steven Matusz, 1994. "Jobs and Chocolate: Samuelsonian Surpluses in Dynamic Models of Unemployment," Review of Economic Studies, Oxford University Press, vol. 61(1), pages 173-192.
    6. Artuc, Erhan, 2013. "PPML estimation of dynamic discrete choice models with aggregate shocks," Policy Research Working Paper Series 6480, The World Bank.
    7. Keane, Michael P & Wolpin, Kenneth I, 1997. "The Career Decisions of Young Men," Journal of Political Economy, University of Chicago Press, pages 473-522.
    8. Erhan Artuç & Shubham Chaudhuri & John McLaren, 2010. "Trade Shocks and Labor Adjustment: A Structural Empirical Approach," American Economic Review, American Economic Association, vol. 100(3), pages 1008-1045, June.
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    Cited by:

    1. Artuç, Erhan & McLaren, John, 2015. "Trade policy and wage inequality: A structural analysis with occupational and sectoral mobility," Journal of International Economics, Elsevier, vol. 97(2), pages 278-294.

    More about this item

    Keywords

    Economic Theory&Research; Labor Markets; Tertiary Education; Labor Policies; Trade Policy;

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