Evidence from Previous Studies
Evidence from Previous Studies
This chapter reviews the findings of previous studies of North–South trade and labour market interactions, which use various methods. It looks at evidence in developing countries, developed countries, and both types of countries together. Most previous studies show that the main effect of North–South trade in manufactures on labour markets is to alter the relative demand for skilled and less‐skilled workers (and that this trade is not based on differences in the scarcity of physical capital). Previous studies also suggest that this impact on the relative demand for skill in the North is small. However, the methods used in these studies are biased towards understatement.
Keywords: capital, demand, interactions, labour market, skill, trade
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