Saving good jobs from global competition by rewarding quality and efforts

• 成果类型: Article
• 署名作者: Wang, Yongjin; Zhao, Laixun
• 署名单位: Nankai University; Kobe University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2015.03.005
• 发表日期: 2015
• 页码: 426-434
• 关键词: trade liberalization; INEQUALITY; efficiency wages; unemployment

摘要

This paper links firms' endogenous quality choices to worker effort and efficiency wages. In the model, firms differ in their ability to monitor workers who have an incentive to shirk. As high quality output requires high worker effort, it is firms with better monitoring ability that upgrade their quality. Indeed, these firms upgrade their quality to such a degree that they also end up paying higher wages to induce even more worker effort. Trade liberalization can induce greater or smaller wage inequality but always enlarges the welfare inequality as higher wages go hand in hand with even greater effort. (C) 2015 Elsevier B.V. All rights reserved.