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The Impact of International Trade on Wages

Since the early 1980s, the U.S. economy has experienced a growing wage differential: high-skilled workers have claimed an increasing share of available income, while low-skilled workers have seen an absolute decline in real wages. How and why this disparity has arisen is a matter of ongoing debate among policymakers and economists. Two competing theories have emerged to explain this phenomenon, one focusing on international trade and labor market globalization as the driving force behind the devaluation of low-skill jobs, and the other focusing on the role of technological change as a catalyst for the escalation of high-skill wages.

This collection brings together innovative new ideas and data sources in order to provide more satisfying alternatives to the trade versus technology debate and to assess directly the specific impact of international trade on U.S. wages. This timely volume offers a thorough appraisal of the wage distribution predicament, examining the continued effects of technology and globalization on the labor market.

416 pages | 54 line drawings, 85 tables | 6 x 9 | © 2000

National Bureau of Economic Research Conference Report

Economics and Business: Business--Business Economics and Management Studies

Table of Contents

Introduction—Robert C. Feenstra
I. Shifts in Labor Demand
1. And Now for Something Completely Different: An Alternative Model of Trade, Education, and Inequality
Paul Krugman
Comment: James E. Rauch and Magnus Lofstrom
2. Effort and Wages: A New Look at the Interindustry Wage Differentials
Edward E. Leamer and Christopher F. Thornberg
Comment: Alan V. Deardorff
3. Offshore Assembly from the United States: Production Characteristics of the 9802 Program
Robert C. Feenstra, Gordon H. Hanson, and Deborah L. Swenson
Comment: James A. Levinsohn
II. The Role of Product Prices
4. What Are the Results of Product-Price Studies and What Can We Learn from Their Differences?
Matthew J. Slaughter
Comment: Robert E. Baldwin
5. International Trade and American Wages in General Equilibrium, 1967-1995
James Harrigan
Comment: Jonathan Eaton
6. Does a Kick in the Pants Get You Going or Does It Just Hurt? The Impact of International Competition on Technological Change in U.S. Manufacturing
Robert Z. Lawrence
Comment: Alan B. Krueger
III. Variation in Wages across States and Industries
7. Understanding Increasing and Decreasing Wage Inequality
Andrew B. Bernard and J. Bradford Jensen
Comment: Lee G. Branstetter
8. Exchange Rates and Local Labor Markets
Linda Goldberg and Joseph Tracy
Comment: Andrew K. Rose
9. Trade Flows and Wage Premiums: Does Who or What Matter?
Mary E. Lovely and J. David Richardson
Comment: George J. Borjas
10. Trade and Job Loss in U.S. Manufacturing, 1979-1994
Lori G. Kletzer
Comment: Lisa M. Lynch
Author Index
Subject Index

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