Skill differentiation and wage disparity in a decentralized matching model of North-South trade

@inproceedings{AbdelRahman2002SkillDA,
  title={Skill differentiation and wage disparity in a decentralized matching model of North-South trade},
  author={Hesham M. Abdel-Rahman and George Norman and Ping Chuan Wang},
  year={2002}
}
In this paper we develop a North-South trade model in which the South produces food and the North produces both food and a high-tech good. Food production is undertaken by unskilled workers, while the high-tech product is made only by horizontally differentiated skilled workers. Owing to the possibility of a peer-group effect, we allow the unskilled workers in the North to be equally or more productive than in the South. Horizontal matching of skilled workers is generally imperfect and the… CONTINUE READING

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