Product Market Integration, Comparative Advantages and Labour Market Performance

Torben M. Andersen, Jan Rose Skaksen

Publikation: Working paperForskning

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Resumé

In a two-country model with trade driven by comparative advantages, it is considered how imperfectly competitive labour markets are affected by lower frictions in international goods trade. Easier goods trading is equivalent to increased mobility of employment across countries and thus a change in the trade-off between wages and employment faced by wage setters. While the effects of product market integration on the trade-off between wages and employment in general is ambiguous, it is shown that product market integration works like a general improvement in productivity via the specialization it allows through trade. Unambiguously, real wages and employment and welfare improve upon reductions in trade frictions, and therefore workers are better off irrespective of whether the market power of unions is enhanced or muted.
OriginalsprogEngelsk
Udgivelses stedBonn
UdgiverIZA
Antal sider18
StatusUdgivet - jan. 2003
NavnIZA Discussion Paper
Nummer698

Emneord

  • Industrial relations
  • Udenrigshandelsteori
  • Komparative fordele
  • Lønteori
  • Beskæftigelse
  • Velfærdsøkonomi

Citer dette

Andersen, T. M., & Rose Skaksen, J. (2003). Product Market Integration, Comparative Advantages and Labour Market Performance. Bonn: IZA. IZA Discussion Paper, Nr. 698
Andersen, Torben M. ; Rose Skaksen, Jan. / Product Market Integration, Comparative Advantages and Labour Market Performance. Bonn : IZA, 2003. (IZA Discussion Paper; Nr. 698).
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Product Market Integration, Comparative Advantages and Labour Market Performance. / Andersen, Torben M.; Rose Skaksen, Jan.

Bonn : IZA, 2003.

Publikation: Working paperForskning

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KW - Industrial relations

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KW - Komparative fordele

KW - Lønteori

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KW - Velfærdsøkonomi

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KW - Wage formation

KW - Employment

KW - Welfare gains

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