Unemployment and relative labor market institutions between trading partners

• 成果类型: Article
• 署名作者: Boulhol, Herve
• 署名单位: heSam Universite; Universite Pantheon-Sorbonne
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2010.10.002
• 发表日期: 2011
• 页码: 83-91
• 关键词: unemployment; labor market institutions; TRADE

摘要

This paper contributes to the literature that highlights the role of trading partners' institutions for a country's unemployment rate. The objective is to study whether the results established in the minimum wage-setting of Davis (1998) hold when unemployment is driven by search frictions. This paper finds that relative labor market institutions matter for equilibrium unemployment as they generate comparative advantages, but there are two main differences with Davis. With North-North trade, unemployment decreases in the low-regulation country. When South is brought into the picture, low-regulation North is not insulated, and unemployment increases in both developed countries as a result of specialization. (C) 2010 Elsevier B.V. All rights reserved.