Harrison, AnnMcLaren, JohnMcMillan, Margaret2012-03-192012-03-192011-08-01https://hdl.handle.net/10986/3515The 1990's dealt a blow to traditional Heckscher-Ohlin analysis of the relationship between trade and income inequality, as it became clear that rising inequality in low-income countries and other features of the data were inconsistent with that model. As a result, economists moved away from trade as a plausible explanation for rising income inequality. In recent years, however, a number of new mechanisms have been explored through which trade can affect(and usually increase) income inequality. These include within-industry effects due to heterogeneous?firms; effects of offshoring of tasks; effects on incomplete contracting; and effects of labor-market frictions. A number these mechanisms have received substantial empirical support.CC BY 3.0 IGOACCOUNTINGADJUSTMENT COSTSAGE CATEGORIESAGGREGATE UNEMPLOYMENTAGGREGATE UNEMPLOYMENT RATEAVERAGE PRODUCTIVITYAVERAGE WAGEAVERAGE WAGESBANKRUPTCYBARGAININGBARGAINING POWERCAPITAL ACCOUNTCAPITAL STOCKCOMMODITIESCOMPARATIVE ADVANTAGECONSUMER DEMANDCONSUMERSCOST FUNCTIONSCOST REDUCTIONSDEVALUATIONDEVELOPED COUNTRIESDEVELOPING COUNTRIESDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDISPLACED WORKERSDISTRIBUTION OF INCOMEDOMESTIC MARKETDOMESTIC SALESEARNINGS LOSSEDUCATIONAL ATTAINMENTELASTICITYEMPLOYEEEMPLOYMENT HISTORIESEMPLOYMENT OPPORTUNITIESEMPLOYMENT RELATIONSHIPEMPLOYMENT SHAREEMPLOYMENT STATUSEQUILIBRIUMEQUILIBRIUM UNEMPLOYMENTEXOGENOUS SHOCKSEXOGENOUS SUPPLYEXPECTED UTILITYEXPORT MARKETSEXPORT SECTOREXPORTSEXPOSUREFACTOR MARKETSFACTORS OF PRODUCTIONFOREIGN DIRECT INVESTMENTFOREIGN MARKETSFREE ENTRYFREE TRADEFREE TRADE AGREEMENTFUTURE RESEARCHGENERAL EQUILIBRIUMGENERAL EQUILIBRIUM MODELGLOBAL ECONOMYGLOBAL TRADEGLOBALIZATIONHIGH WAGEHIGH WAGESHUMAN CAPITALIMPLICIT CONTRACTIMPLICIT CONTRACTSIMPORT COMPETITIONIMPORTSINCOMEINCOME DISTRIBUTIONINCOME INEQUALITYINCOME LEVELSINCOMESINCOMPLETE CONTRACTINGINCOMPLETE CONTRACTSINDUSTRY WAGEINNOVATIONINSURANCEINTERNATIONAL ECONOMICSINTERNATIONAL TRADEINTERNATIONAL TRADE MODELSJOBSLABOR ADJUSTMENTLABOR COSTSLABOR DEMANDLABOR ECONOMICSLABOR FORCELABOR MARKETLABOR MARKET ADJUSTMENTLABOR MARKET INSTITUTIONSLABOR MARKET REFORMSLABOR MOBILITYLABOR PRODUCTIVITYLABOR PRODUCTIVITY GROWTHLABOR STATISTICSLABOR SUPPLYLIQUIDITYLOW-INCOME COUNTRIESMACROECONOMICSMARGINAL COSTMARGINAL COSTSMARGINAL PRODUCTMARKET CONDITIONSMARKET LEADERMARKET SHAREMIDDLE INCOME COUNTRIESMINIMUM WAGEMINIMUM WAGESMONOPOLISTIC COMPETITIONMOTIVATIONNET EMPLOYMENTNEW PRODUCTOCCUPATIONOCCUPATIONSOPEN ECONOMYOUTPUTOUTSOURCINGPORTFOLIOPREVIOUS STUDIESPRODUCTION FUNCTIONPRODUCTION PROCESSPRODUCTION WAGESPRODUCTION WORKERSPRODUCTIVITY LEVELRATE OF RETURNREAL WAGEREAL WAGESREPUTATIONRISK AVERSERISK NEUTRALRISK PREMIUMSAVINGSSERVICE SECTORSKILL PREMIUMSKILL REQUIREMENTSKILL UPGRADINGSKILLED LABORSKILLED WORKERSSMALL ECONOMYTECHNOLOGICAL CHANGETRADE IN GOODSTRADE LIBERALIZATIONTRADE MODELTRADE POLICYTRADE REFORMSTRADESUNEMPLOYEDUNEMPLOYED WORKERSUNEMPLOYMENTUNEMPLOYMENT RATESUNSKILLED LABORUNSKILLED WORKERSUTILITY FUNCTIONVOLATILITYWAGE DISTRIBUTIONWAGE GAPWAGE GROWTHWAGE INCREASESWAGE INEQUALITYWAGE LOSSWAGE THEORYWORKERWORKER HETEROGENEITYWORKERS EXPERIENCEWORKING CONDITIONSWORLD ECONOMYWORLD MARKETSWorld Bank10.1596/1813-9450-5754