Product Market Integration and Wage Formation

Torben M. Andersen (tandersen@econ.au.dk) and Jan Rose S rense
Additional contact information
Torben M. Andersen: University of Aarhus, Postal: Department of Economics, University of Aarhus, EPRU and CEPR.
Jan Rose S rense: University of Aarhus, Postal: University of Aarhus

Journal of Economic Integration, 2000, vol. 15, 281-293

Abstract:

This paper analyses the basic labour market inter-dependencies among coun - tries with intra-industrial trade and imper fectly competitive product and labour markets. The paper stresses two major channels through which increased integration may affect product markets and therefore in turn labour markets. First, market entry becomes easier and/or less costly implying that m o re goods become traded goods. Second, market integration among economies already open to trade may reduce the explicit or implicit trade costs of selling in foreign markets. It is found that the two channels have different implications for wage formation.

Keywords: Trade Costs; Intra-industry Trade; Wage Formation (search for similar items in EconPapers)
JEL-codes: F12 F15 J31 J51 (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:integr:0133

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