Recent empirical work on the effects of minimum wages has called into question the conventional wisdom that minimum wages invariably reduce employment. We develop a model of \emph{monopsonistic competition} with \emph{free entry} to analyze the effects of minimum wages, and our predictions fit...

A number of theories (search and efficiency wages) have been developed, in part, to explain why identically able workers are often paid different wages. However, when there is a minimum wage, they do not explain the resulting ``spike" in the wage distribution. Our model's predictions are...

The institutional reforms towards trade liberalizations in Latin America during the 1980s and the 1990s have introduced a good measure of import competition, but trade policies alone are not sufficient to create a competitive environment in an economy. The countries in Latin America have not had...

This paper uses firm level data to investigate the impact of trade liberalization on manufacturing sector employment in Morocco. This paper extends the existing research in various dimensions. First, it analyses the effect of trade openness on different skill levels of the manufacturing labor...

The North American Free Trade Agreement appeared to promise economic growth for Mexico and improved living conditions for its people. While the Mexican economy has recovered significantly from its post-NAFTA collapse, there is mounting evidence that many of the pre-NAFTA warnings of worsening...

Removal of tariff restrictions from the relatively low-skill sectors; growth in foreign direct investment; and, decline of trade union strength of the unskilled workers are cited in the empirical literature as the prime factors responsible for the growing incidence of wage inequality in many of...

The new version of the CGE model of the Slovenian economy, based on the 1998 SAM, was used for simulations of the consequences of further foreign trade liberalization after 1998 as the outcome of the finished processes of implementation of Free Trade Agreements and the European Agreement,...

The paper purports to examine the implications of a free education policy and trade liberalization on the child and adult labour markets in the set-up of a Harris-Todaro type general equilibrium model. It has been found that a hike in the education subsidy or inflow of foreign capital may...

As the barriers to hemispheric trade and integration are lowered, it will be asked whether we will we hear the "giant sucking sound" of poorer nations luring U.S. and Canadian firms south to take advantage of low wages and lax environmental regulations? Or, will Latin American nations passively...