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Does protectionism harm unskilled workers?

Hamid Beladi, Sugata Marjit and Reza Oladi ()

Economics and Politics, 2018, vol. 30, issue 3, 444-450

Abstract: In this paper we construct a general equilibrium model of trade and illustrate that return to unskilled labor may be negatively correlated with the price of product it produces. Specifically, we show that greater protection for the intermediate good that uses “unskilled” labor can reduce the unskilled wages. This result has interesting political‐economic implications.

Date: 2018
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