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Workers'age and the impact of trade shocks

  • Artuc, Erhan

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.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6035.

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Date of creation: 01 Apr 2012
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Handle: RePEc:wbk:wbrwps:6035
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  1. John Kennan & James R. Walker, 2011. "The Effect of Expected Income on Individual Migration Decisions," Econometrica, Econometric Society, vol. 79(1), pages 211-251, 01.
  2. Erhan Artuc & Shubham Chaudhuri & John McLaren, 2007. "Trade Shocks and Labor Adjustment: A Structural Empirical Approach," NBER Working Papers 13465, National Bureau of Economic Research, Inc.
  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. Michael P. Keane & Kenneth I. Wolpin, 1995. "The career decisions of young men," Working Papers 559, Federal Reserve Bank of Minneapolis.
  5. Artuc, Erhan, 2013. "PPML estimation of dynamic discrete choice models with aggregate shocks," Policy Research Working Paper Series 6480, The World Bank.
  6. Rod Falvey & David Greenaway & Joana Silva, . "Trade Liberalisation and Human Capital Adjustment," Discussion Papers 10/08, University of Nottingham, GEP.
  7. Moritz Ritter, 2012. "Trade and Inequality in a Directed Search Model with Firm and Worker Heterogeneity," DETU Working Papers 1202, Department of Economics, Temple University.
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