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Skilled Worker Migration and Trade: Inequality and Welfare
Author(s) -
Bougheas Spiros,
Nelson Douglas R.
Publication year - 2012
Publication title -
the world economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.594
H-Index - 68
eISSN - 1467-9701
pISSN - 0378-5920
DOI - 10.1111/j.1467-9701.2011.01428.x
Subject(s) - economics , welfare , inequality , labour economics , technological change , wage inequality , international economics , macroeconomics , market economy , mathematical analysis , mathematics , wage
We develop a two‐sector, two‐country model where trade is driven by technological differences. Each country is populated by large number of heterogeneous workers distinguished by their level of skills. Given that one country has a technological advantage in the skilled intensive good when we allow for both trade and migration skilled workers migrate to that country. We analyse the consequences of this migration for both inequality and welfare for the source and the host country.