Monday, March 03, 2008

Trade and Wages - Krugman speaks

A globalisation post really by Paul Krugman who is one of the world's leading trade economists.


How can we quantify the actual effect of rising trade on wages? The answer, given the current state of the data, is that we can’t. As I’ve said, it’s likely that the rapid growth of trade since the early 1990s has had significant distributional effects. To put numbers to these effects, however, we need a much better understanding of the increasingly fine-grained nature of international specialization and trade.

This is an excellent conclusion as it fits directly into my international trade research agenda analysing trade at the firm level.

H/T: Trade Diversion.

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