Capital equipment, such as computers and industrial machinery, embodies skill-biased technology and, hence, is complementary to skilled labor. Many countries, by importing a large share of their capital, import skill-biased technology and a rise in the skill premium. In this paper we develop a...

We study the implications of trade liberalizations on real GDP and real consumption in a widely-used class of models in international trade. We calculate the change in aggregate quantities in response to a reduction in international trade costs, following as closely as possible the procedures...