In this paper, we propose and test a novel effect of immigration on the wages of native workers. Existing studies have focused on the wage effects that result from changes in the aggregate labour supply in a competitive labour market. We argue that if labour markets are not fully competitive,...

This paper studies the link between a firms education level, export performance and wages of its workers. We argue that firms may escape intence competition in international markets by using high skilled workers to differentiate their products. This story is consistent with our empirical...

In this paper, we set up a two-country general equilibrium model where trade unions have wage bargaining power. We show that a decrease in trade distortions inducing further product market integration gives rise to specialization gains as well as a labour market reform effect. The implications...

The relative demand for skills has increased considerably in many OECD countries during recent decades. This development is potentially explained by capital-skill complementarity and high growth rates of capital equipment. When production functions are characterized by capital-skill...

This paper studies the impact of outsourcing on individual wages. In contrast to the standard approach in the literature, we focus on domestic outsourcing as well as foreign outsourcing. By using a simple theoretical model, we argue that, if outsourcing is associated with specialization gains...