Trade, Migration Costs and Asymmetric Migration Patterns
The World Economy, 42: 2629-2648, 2019
Posted: 1 Jun 2020
Date Written: May 2, 2020
This paper shows that trade and emigration of skilled workers from a poor country is complementary but that between trade and emigration of unskilled workers is a substitute. The asymmetric effect of more openness to trade on the local wages seems to be crucial in driving such results. The asymmetric changes in skilled and unskilled wages generate counterintuitive outcomes regardless of the policy shock that triggers such wage effect. One of the more compelling outcomes is rise in wage inequality as influenced by asymmetric emigration patterns.
Keywords: Trade, emigration, skilled labour, specific factor, remittances, tax
JEL Classification: F22, J64, O15
Suggested Citation: Suggested Citation