Multi-dimensional skills and matching: implications for international trade and wage inequality

Chihiro Inaba

Review of Economics and Institutions, 2019, vol. 10, issue 2

Abstract: Workers have various kinds of skills and abilities in different amounts and proportions.The technology of firms in an industry is also characterized by a certain skill combination. The combinations of skills supplied by workers are often not the same as those demanded by firms---there can be mismatches between the skills supplied by workers and those demanded by firms. This kind of mismatches can cause both inter- and intra-industry wage inequalities. With two countries that have two industries and different skill distribution, international trade has a portion of the workers to move to a industry with a higher wage income than by remaining in the former industry. However, the moving workers who are matched with less appropriate firms may receive a lower wage income than in autarky.

Keywords: multi-dimensional skills; skill mismatch; international trade; income inequality (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (1)

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