On the heterogeneous effect of trade on unemployment

Arbeitspapier

We embed a model of the labor market with sector-specific search-and-matching frictions into a Ricardian model with a continuum of goods to show that trade reduces unemployment in countries with comparative advantage in sectors with more efficient labor markets and leads to higher unemployment in countries with comparative advantage in sectors with less efficient labor markets. We test this prediction in a panel dataset of 107 countries during the period 1995-2009 and find that the data supports the theoretical prediction. Our results also help reconciliate the apparently contradicting evidence in the empirical literature on the impact of trade on unemployment.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: FERDI Working Paper ; No. P180

Classification and Topics

• Classification: Wirtschaft
• Subject: Trade ; Search unemployment

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Carrère, Céline ; Fugazza, Marco ; Olarreaga, Marcelo ; Robert-Nicoud, Frédéric
• Event: Veröffentlichung
• (who): Fondation pour les études et recherches sur le développement international (FERDI)
• (where): Clermont-Ferrand
• (when): 2016

Further information

• Handle: http://hdl.handle.net/10419/269461
• Last update: 10.03.2025, 11:42 AM CET