Labor in the Global Economy

NBER Reporter, Summer 2001 | Go to article overview

Labor in the Global Economy


An NBER-Universities Research Conference on "Labor in the Global Economy" took place in Cambridge on May 11 and 12. Labor. Studies Program Director Richard Freeman, NBER and Harvard University, was the organizer. Eli Berman, NBER and Boston University, and Morris M. Kleiner, NBER and University of Minnesota, were moderators. The program was:

Andrew B. Bernard, NBER and Dartmouth College; J. Bradford Jensen, University of Maryland; and Peter K. Schott, Yale University, "Factor Price Equality and the Economies of the United States" (NBER Working Paper No. 8068)

Discussant: Eli Berman

Dae-Il Kim, Seoul National University, and Peter Mieszkowski, Rice University, "The Effects of International Trade on Wage Inequality in the United States"

Discussants: Bernardo S. Blum, University of California, Los Angeles, and Eli Berman

Linda Goldberg and Joseph Tracy, Federal Reserve Bank of New York, "Exchange Rates and Wages" (NBER Working Paper No. 8137)

Discussant: Lori Kletzer, University of California, Santa Cruz.

James P. Smith, Duncan Thomas, Elizabeth Frankenberg, Kathleen Beagle, and Graciela Teruel, RAND, "Wages, Employment, and Economic Shocks: Evidence from Indonesia"

Discussants: David E. Bloom, NBER and Harvard University, and John R. Harris, Boston University

Belton M. Fleisher and Xiaojun Wang, Ohio State University, "Skill Differentials, Returns to Schooling, and Market Segmentation in a Transition Economy: The Case of Mainland China"

Discussant: Gary H. Jefferson, Brandeis University

Chang-Tai Hsieh, Princeton University, and Keong T. Woo, KPMG "The Impact of Outsourcing to China on Hong Kong's Labor Market"

Discussant: Jeffrey H. Bergstrand, University of Notre Dame

Ju-Ho Lee, Korea Development Institute; Young-Kye Moh, Ohio State University; and Dae-Il Kim, Seoul National University "Do Unions Inhibit Labor Flexibility? Lessons from Korea"

Discussant: David L. Linduer, Wellesley College

Andrew M. Warner, Harvard University, "International Wage Determination and Globalization"

Discussants: Malcolm Cohen, University of Michigan, and Peter Gottschalk, Boston College

Gary Fields, Paul Cichello, David Newhouse, and Samuel Frieje, Cornell University; and Marta Menendez, DELTA, "A Four Country Story: Household Income Dynamics in Indonesia, South Africa, Spain, and Venezuela"

Discussants: Peter Gottschalk and John R. Harris

Morris M. Kleiner, and Hwikwon Ham, University of Minnesota, "Do Industrial Relations Institutions Affect Economic Efficiency? International and U.S. State-Level Evidence"

Discussant: Takao Kato, Colgate University

Bernard, Jensen, and Schott consider the role of international trade in shaping the product mix and relative wages for regions within the United States. They ask whether all the regions in the United States face the same relative factor prices. Using data from 1972-92, they conclude that all regions do not face the same relative factor price; rather, there are at least three distinct factor price cones. Sorting regions into cones with similar relative factor prices, the authors find that industry mix varies systematically across the groups. Regions that switch cones over time have more churning of industries.

Kim and Mieszkowski develop several simple general equilibrium models to analyze the effects of increased international trade on the growth of income inequality that occurred in the United States during the 1970s and 1980s. They conclude that the expansion of trade has decreased the real wage of unskilled labor by between 1 and 3 percent, a relatively small amount. To obtain this estimate, they develop a new measure of skill based on information found in the Directory of Occupational Titles. This skill index and data from the Occupational Employment Survey and Input-Output Information are used to calculate three factor shares for two tradable and two non-tradeable sectors. …

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