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Another Nail in the Coffin? Or Can the Trade Based Explanation of Changing Skill Structures Be Resurrected?
Author(s) -
Desjonqueres Thibaut,
Machin Stephen,
Van Reenen John
Publication year - 1999
Publication title -
scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/1467-9442.00172
Subject(s) - underpinning , economics , wage inequality , wage , competition (biology) , labour economics , inequality , international economics , international trade , ecology , mathematical analysis , civil engineering , mathematics , engineering , biology
The skill structure of wages and employment has altered markedly in recent years. In some countries (most notably the UK and the US) wage inequality has risen sharply and in most countries relative demand has shifted unfavourably against the less skilled. In this paper we reassess the evidence that rising international competition from developing countries is the crucial factor underpinning these changes. Our results, based on newly constructed internationally comparable industry data, find little support for the predictions of the basic Heckscher‐Ohlin (H‐O) trade model. JEL classification: J 31; F 14