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- W2142213107 abstract "This paper constructs a dynamic model of trade between two countries, one with flexible wages (America) and another with a rigid wage for less-skilled workers (Europe). The model incorporates global R&D races that generate random switches in trade patterns. Furthermore, rigid wages in Europe give rise to unemployment in that region. Using the model, I study the role of international trade and labor market institutions in mediating local and global shocks. I also investigate the factors behind the stylized trends in Europe and the US: rising European unemployment, rising wage inequality (especially for the US), skill upgrading, and rising R&D intensities. I find that technology shocks coupled with institutional response from the European labor markets can generate results consistent with the trends." @default.
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- W2142213107 date "2006-05-01" @default.
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- W2142213107 title "Labor market rigidities and R&D-based growth in the global economy" @default.
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- W2142213107 doi "https://doi.org/10.1016/j.jedc.2005.03.003" @default.
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