International Trade with Equilibrium Unemployment

Carl Davidson; Steven J. Matusz

Published by Princeton University Press 2010

International Trade with Equilibrium Unemployment

Carl Davidson and Steven J. Matusz

https://doi.org/10.1515/9781400832163

Overview
Contents

About this book

While most standard economic models of international trade assume full employment, Carl Davidson and Steven Matusz have argued over the past two decades that this reliance on full-employment modeling is misleading and ill-equipped to tackle many important trade-related questions. This book brings together the authors' pioneering work in creating models that more accurately reflect the real-world connections between international trade and labor markets.

The material collected here presents the theoretical and empirical foundations of equilibrium unemployment modeling, which the authors and their collaborators developed to give researchers and policymakers a more realistic picture of how international trade affects labor markets, and of how transnational differences in labor markets affect international trade. They address the shortcomings of standard models, describe the empirics that underlie equilibrium unemployment models, and illustrate how these new models can yield vital insights into the relationship between international trade and employment. This volume also includes an indispensable general introduction as well as concise section introductions that put the authors' work in context and reveal the thinking behind their ideas.

Economists are only now realizing just how important these ideas are, making this book essential reading for researchers and students.

Author / Editor information

Carl Davidson is professor of economics and chair of the Department of Economics at Michigan State University. Steven J. Matusz is professor of economics at Michigan State. They are the authors of International Trade and Labor Markets: Theory, Evidence, and Policy Implications.

Reviews

"The pathbreaking research synthesized in this volume shows that labor market frictions are central to understanding the distributional consequences of international trade. Anyone interested in the intellectual debate about globalization should read this book. It is an essential reference for researchers and students in international trade."—Stephen J. Redding, London School of Economics and Political Science

"Davidson and Matusz pioneered the modern theory of international trade with labor market frictions. This book knits together their major work on this subject, and delivers fundamental insights concerning the effects of globalization on unemployment patterns, wage distributions, adjustment burdens, intergenerational welfare gaps, and trade policy formation. Any serious study of this literature should begin with this volume."—James R. Tybout, Pennsylvania State University

"This is an important and timely volume. The quality of scholarship in these papers is of a consistently high standard, and readers will not only find the individual papers analytically rich but also accessible. The economics profession has finally recognized just what a central issue trade with unemployment is—Davidson and Matusz recognized it twenty years ago and have been building tractable models that have yielded important insights."—David Greenaway, University of Nottingham

Topics

Frontmatter Publicly Available Download PDF	i
CONTENTS Publicly Available Download PDF	vii
PREFACE Requires Authentication Unlicensed Licensed Download PDF	ix
ACKNOWLEDGMENTS Requires Authentication Unlicensed Licensed Download PDF	xv
Chapter 1. OUR MOTIVATION Requires Authentication Unlicensed Licensed Download PDF	1
PART 1: NEW INSIGHTS FROM “OLD” TRADE THEORY
Introduction to Part 1. Requires Authentication Unlicensed Licensed Download PDF	27
Chapter 2. THE STRUCTURE OF SIMPLE GENERAL EQUILIBRIUM MODELS WITH FRICTIONAL UNEMPLOYMENT Carl Davidson, Lawrence Martin and Steven Matusz Requires Authentication Unlicensed Licensed Download PDF	33
Chapter 3. TRADE AND SEARCH-GENERATED UNEMPLOYMENT Carl Davidson, Lawrence Martin and Steven Matusz Requires Authentication Unlicensed Licensed Download PDF	60
PART 2: COMPLICATIONS
Introduction to Part 2. Requires Authentication Unlicensed Licensed Download PDF	93
Chapter 4. MULTIPLE FREE TRADE EQUILIBRIA IN MICRO MODELS OF UNEMPLOYMENT Carl Davidson, Lawrence Martin and Steven Matusz Requires Authentication Unlicensed Licensed Download PDF	97
Chapter 5. JOBS AND CHOCOLATE: SAMUELSONIAN SURPLUSES IN DYNAMIC MODELS OF UNEMPLOYMENT Carl Davidson, Lawrence Martin and Steven Matusz Requires Authentication Unlicensed Licensed Download PDF	110
Chapter 6. LONG-RUN LUNACY, SHORT-RUN SANITY: A SIMPLE MODEL OF TRADE WITH LABOR MARKET TURNOVER Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	138
PART 3: EMPIRICS
Introduction to Part 3. Requires Authentication Unlicensed Licensed Download PDF	161
Chapter 7. TRADE AND TURNOVER: THEORY AND EVIDENCE Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	165
Chapter 8. TRADE, TURNOVER, AND TITHING Christopher S. P. Magee, Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	195
PART 4: ADJUSTMENT COSTS AND POLICY ISSUES
Introduction to Part 4. Requires Authentication Unlicensed Licensed Download PDF	223
Chapter 9. SHOULD POLICY MAKERS BE CONCERNED ABOUT ADJUSTMENT COSTS? Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	227
Chapter 10. AN OVERLAPPING-GENERATIONS MODEL OF ESCAPE CLAUSE PROTECTION Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	265
Chapter 11. TRADE LIBERALIZATION AND COMPENSATION Carl Davidson and Steven J. Matusz Requires Authentication Unlicensed Licensed Download PDF	292
Chapter 12. CAN COMPENSATION SAVE FREE TRADE? Carl Davidson, Steven J. Matusz and Douglas R. Nelson Requires Authentication Unlicensed Licensed Download PDF	321
PART 5: NEW INSIGHTS FROM “NEW” TRADE THEORY
Introduction to Part 5. Requires Authentication Unlicensed Licensed Download PDF	351
Chapter 13. GLOBALIZATION AND FIRM-LEVEL ADJUSTMENT WITH IMPERFECT LABOR MARKETS Carl Davidson, Steven J. Matusz and Andrei Shevchenko Requires Authentication Unlicensed Licensed Download PDF	355
Chapter 14. OUTSOURCING PETER TO PAY PAUL: HIGH-SKILL EXPECTATIONS AND LOW-SKILL WAGES WITH IMPERFECT LABOR MARKETS Carl Davidson, Steven J. Matusz and Andrei Shevchenko Requires Authentication Unlicensed Licensed Download PDF	388
INDEX Requires Authentication Unlicensed Licensed Download PDF	407

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