Quality Differentiation and the Labour Market Effects of International Trade

Giuseppe Celi and Alasdair Smith ()
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Alasdair Smith: CELPE University of Salerno, University of Sussex, http://www.sussex.ac.uk/profiles/2469

CELPE Discussion Papers from CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy

Abstract: This paper offers a new treatment of the labour market effects of international trade, based on a model in which intra-industry trade is explained on Heckscher-Ohlin principles. The model is more consistent with stylised facts about North-South trade than the traditional Heckscher-Ohlin model of inter-industry trade. Applying the model to trade between Italy and ‘non-advanced countries’ and inferring the factor content of intra-industry trade from the inter-sectoral relationship between factor intensity and average unit values of exports, we find that the labour market effects of intra- industry trade add significantly to the estimated factor market impact of trade.

Keywords: intra-industry trade; North-South trade; vertical product differentiation; labour market effects of international trade (search for similar items in EconPapers)
JEL-codes: F10 (search for similar items in EconPapers)
Date: 1999-07
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Citations: View citations in EconPapers (5)

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