The Effect of Globalization on Wages in the Advanced Economies

By Phillip L Swagel, Matthew J. Slaughter

April 1, 1997

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Phillip L Swagel, and Matthew J. Slaughter The Effect of Globalization on Wages in the Advanced Economies, (USA: International Monetary Fund, 1997) accessed December 22, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper examines the effect of globalization on labor markets in the advanced economies, focusing particularly on the claim that increased economic integration has widened the gap between the wages of more skilled and less skilled workers. The broad consensus of research is that globalization, both in terms of increased trade as well as increased capital mobility and foreign direct investment, has had only a modest effect on wages. Instead, changes in technology have led to a pervasive shift in demand for labor that has favored skilled workers to the detriment of less skilled workers.

Subject: Imports, Income inequality, International trade, Labor, Labor demand, Labor markets, National accounts, Wages

Keywords: Capital mobility, Europe, Factor, Factor price, Factor price elasticities of demand, Firm, Global, Globalization, Import competition, Imports, Income inequality, Job market, Krugman terms, Labor demand, Labor markets, North America, Per capita income, Price equalization theorem, Product price, Product price change, Rate of return, Trade, Trade and wages, Trade competition, Trade economist, Wage, Wage differential, Wages, WP

Publication Details

Pages:

33
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1997/043
Stock No:

WPIEA0431997
ISBN:

9781451846294
ISSN:

1018-5941

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