Sorting It Out: International Trade with Heterogeneous Workers

Abstract

Each worker brings a bundle of skills to the workplace, for example, quantitative and communication skills. Since employers must take this bundle as a package deal, they choose workers with just the right mix of skills. We show that international differences in the distribution of worker skill bundles-for example, Japan's abundance of workers with a modest mix of both quantitative and teamwork skills-have important implications for international trade, industrial structure, and domestic income distribution. Formally, we model two-dimensional worker heterogeneity and show that the second moments of the distribution of skills are critical, as in the Roy model. (c) 2007 by The University of Chicago. All rights reserved..

Trade and the political economy of redistribution

“…Much more central to our results is that consumers have the possibility to import goods in an open economy. We also relate to the literature considering the effects of international trade when factors are imperfectly mobile between sectors or occupations (Kambourov (2009), Artuc, Chaudhuri, andMcLaren (2010), Ohnsorge and Trefler (2007)). …”

Inequality and Unemployment in a Global Economy

“…One strand of this literature is concerned with competitive assignment models, and investigates the conditions under which there is assortative matching, including Heckman and Honore (1990), Ohnsorge and Trefler (2007), Legros and Newman (2007), and Costinot and Vogel (2009). In contrast, another strand of this literature considers search frictions in the labor market, including in particular Mortensen (1970), Pissarides (1974), Diamond (1982a,b), Mortensen and Pissarides (1994) and Pissarides (2000).…”

Economic growth, comparative advantage, and gender differences in schooling outcomes: Evidence from the birthweight differences of Chinese twins

“…We can order without any loss of generality occupations/tasks by skill intensity, as in Ohnsorge and Trefler (2007), so that α i >0, where α i =∂α/∂i. Thus, a higher i means a more skill intensive task.…”