An Analysis of Income Distribution between the North and the South: the Grossman-Helpman and Lai Results Re-examined
This paper studies the effects of labor supply on relative wages in a dynamic North–South model of trade. Lai (1995)—a generalization of the Grossman and Helpman (1991a,b, ch. 11) models—showed that the relative wage of skilled (unskilled) labor in a region is positively (negatively) related to the...
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| Veröffentlicht in: | Review of international economics 2008-02, Vol.16 (1), p.159-172 |
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| container_title | Review of international economics |
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| creator | Shimizu, Takanori Okawa, Yoshifumi Okamoto, Hisayuki |
| description | This paper studies the effects of labor supply on relative wages in a dynamic North–South model of trade. Lai (1995)—a generalization of the Grossman and Helpman (1991a,b, ch. 11) models—showed that the relative wage of skilled (unskilled) labor in a region is positively (negatively) related to the supply of skilled (unskilled) labor in that region. These surprising results depend crucially on the specification of the functional form of the Southern imitation activity. We will show that these results (except for the relative wage of unskilled labor in Lai) are reversed in the case where the productivity of imitation depends only on the number of products the North manufactures. |
| doi_str_mv | 10.1111/j.1467-9396.2007.00733.x |
| format | Article |
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| identifier | ISSN: 0965-7576 |
| ispartof | Review of international economics, 2008-02, Vol.16 (1), p.159-172 |
| issn | 0965-7576 1467-9396 |
| language | eng |
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| source | Wiley Online Library - AutoHoldings Journals; RePEc; EBSCOhost Business Source Complete |
| subjects | Economic models Economic theory Income distribution Income inequality International trade Labor economics Labor supply Labour supply Manufacturing North-South trade Studies Trade models Wages & salaries |
| title | An Analysis of Income Distribution between the North and the South: the Grossman-Helpman and Lai Results Re-examined |
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