Replication data for: Trade Shocks and Labor Adjustment: A Structural Empirical Approach

Principal Investigator(s): View help for Principal Investigator(s) Erhan Artuç; Shubham Chaudhuri; John McLaren

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Project Citation:

Artuç, Erhan, Chaudhuri, Shubham, and McLaren, John. Replication data for: Trade Shocks and Labor Adjustment: A Structural Empirical Approach. Nashville, TN: American Economic Association [publisher], 2010. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-11. https://doi.org/10.3886/E112346V1

Project Description

Summary: The welfare effects of trade shocks turn on the nature and magnitude of the costs workers face in moving between sectors. Using an Euler-type equilibrium condition derived from a rational expectations model of dynamic labor adjustment, we estimate the mean and variance of workers' switching costs from the US CPS. We estimate high values of both parameters, implying slow adjustment of the economy and sharp movements in wages in response to trade shocks. However, import-competing workers can still benefit from tariff removal; liberalization lowers their wages in the short and long run but raises their option value.(JEL E24, F13, F16)

Scope of Project

Subject Terms: Labor Markets; International Trade; Employment

JEL Classification:
      E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
      F13 Trade Policy; International Trade Organizations
      F16 Trade and Labor Market Interactions

Geographic Coverage: United States

Data Type(s): program source code

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Published Versions

V1 [2019-10-11]

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