University of Surrey

Test tubes in the lab Research in the ATI Dance Research

Trade, Wages, and Productivity

Behrens, K, Mion, G, Murata, Y and Suedekum, J (2012) Trade, Wages, and Productivity .

Full text not available from this repository.

Abstract

We develop a new general equilibrium monopolistic competition model with variable demand elasticity, heterogeneous firms, and multiple asymmetric regions. Wages, productivity, consumption diversity, and markups across firms and markets are all endogenously determined and respond to trade integration in a way that is consistent with empirical evidence. Using Canada-US regional data, we structurally estimate the model and simulate the impacts of removing all trade barriers generated by the Canada-US border. We find that Canadian average labor productivity increases by 8.03%, whereas US average labor productivity rises by just 1.02%. Consumers� exposure to market power falls sizably by up to 12.11% in the Canadian provinces, and by up to 2.82% in the US states. At the firm level, however, markup changes are ambiguous and depend on the firm�s productivity and location. Our results suggest that markups on the firms� side provide a very different piece of information than markups on the consumers� side, which are central to any welfare statement.

Item Type: Other
Authors :
NameEmailORCID
Behrens, KUNSPECIFIEDUNSPECIFIED
Mion, Gg.mion@surrey.ac.ukUNSPECIFIED
Murata, YUNSPECIFIEDUNSPECIFIED
Suedekum, JUNSPECIFIEDUNSPECIFIED
Date : 2012
Uncontrolled Keywords : F120, F150, F170, firm heterogeneity, endogenous markups, gravity equation, monopolistic competition, general equilibrium
Depositing User : Symplectic Elements
Date Deposited : 16 May 2017 15:33
Last Modified : 16 May 2017 15:33
URI: http://epubs.surrey.ac.uk/id/eprint/820467

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year


Information about this web site

© The University of Surrey, Guildford, Surrey, GU2 7XH, United Kingdom.
+44 (0)1483 300800