Too Much of a Good Thing? Labor Market Imperfections as a Source of Exceptional Exporter Performance

Autor:	Carsten Eckel, Stephen R. Yeaple
Rok vydání:	2017
Předmět:	Consumption (economics) ComputingMilieux_THECOMPUTINGPROFESSION Need to know High productivity media_common.quotation_subject Economics Market distortion Market power Monetary economics Free trade Welfare Market failure media_common
DOI:	10.3386/w23834
Popis:	International trade is primarily conducted by large, multiproduct firms (MPFs) that pay above average wages and exhibit high productivity. In this paper we show that if firms can invest in management technologies for identifying worker skill then they will enjoy a form of market power in the labor market that artificially lowers their labor costs. This market failure results in excessive consumption of resources by large, productive exporting firms relative to the social optimum. Trade liberalization then has an ambiguous effect on aggregate welfare: lower trade costs increase access to foreign goods but also exacerbates the labor market distortion as resources are transferred to large firms. The model highlights the need to know why firms “excel” before drawing welfare conclusions regarding cross firm reallocations of resources.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::9e24855ef9d330e5c79fa72509958221 https://doi.org/10.3386/w23834 Zobrazit plný text záznamu