Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/62688
Authors: 
Burda, Michael C.
Dluhosch, Barbara
Year of Publication: 
2001
Series/Report no.: 
Discussion Papers, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes 2001,41
Abstract: 
Fragmentation of the value-added-chain is modeled as the reaction of monopolistically competitive firms to the removal of barriers to trade and factor mobility in an integrated trading environment. Since fragmentation requires high-skilled labor, this form of globalization can induce labor market effects similar to those caused by skill-biased technical change. In the short run, it is likely that fragmentation will be accompanied by an increase in high and low-skilled service employment as well as in the skilled wage premia, as observed in OECD countries. These implications can be reversed, however, as new firms enter the market.
Subjects: 
International Trade
Organization of Production
Technology Choice
Division of Labor
JEL: 
F10
L23
O33
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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