Worker-Specific Effects of Globalisation

Hartmut Egger () and Udo Kreickemeier

Discussion Papers from University of Nottingham, GEP

Abstract: This paper sets up a general equilibrium model in which firms differ in their productivity, and workers have fairness preferences and hence provide full effort only if their wage is sufficiently high. With the wage considered fair by workers depending on the operating profits of the firm in which they are employed, more productive firms pay higher wages. We study trade between two symmetric countries. Exporters have higher operating profits, leading to an exporter wage premium. There are worker-specific effects of trade due to both the exporter wage premium and a reallocation of workers between firms.

Keywords: Heterogeneous firms; Wage inequality; Fair wages; Involuntary unemployment (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Worker‐specific Effects of Globalisation (2010)
Working Paper: Worker-Specific Effects of Globalisation (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:not:notgep:09/23

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