Delay and dynamics in labor market adjustment:: Simulation results

• 成果类型: Article
• 署名作者: Artuc, Erhan; Chaudhuri, Shubham; McLaren, John
• 署名单位: Koc University; The World Bank; University of Virginia
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2007.11.003
• 发表日期: 2008
• 页码: 1-13
• 关键词: Labor mobility; gross flows; net flows; gradualism; Trade shocks; trade liberalization

摘要

We simulate numerically a trade model with labor mobility costs added, modeled in such a way as to generate gross flows in excess of net flows. Adjustment to a trade shock can be slow with plausible parameter values. In our base case, the economy moves 95% of the distance to the new steady state in approximately eight years. Gross flows have a large effect on this rate of adjustment and on the normative effects of trade. Announcing and delaying the liberalization can build - or destroy - a constituency for free trade. We study the conditions under which these contrasting outcomes occur. (C) 2007 Elsevier B.V All rights reserved.