학술저널
Endogenous Wage Differentials, Imperfect Labor Mobility and Customs Unions Theory
Endogenous Wage Differentials, Imperfect Labor Mobility and Customs Unions Theory
- 세종대학교 경제통합연구소
- Journal of Economic Integration
- 제4권 제1호
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1989.0315 - 26 (12 pages)
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This paper investigates the welfare consequences of forming a trade-creating or trade-diverting customs union in the presence of endogenous wage differential arising from labor immobility. Specifically, it is demonstrated that the direction of the wage differential ditermines whether trade creation I will improve or lower welfare. The wage differential also plays a crucial role in determining the welfare effects of trade creation II and trade diversion II. However, trade diversion I may have any welfare effects in the presence or absence of the wage differential.
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