Purpose: This paper aims to examine how the “wage premium,” the percentage by which wages earned by skilled workers exceed those of unskilled workers, varies across industries characterized by different levels of competitiveness. Design/methodology/approach: A theoretical model employing...

In this paper, we seek to understand why the “wage premium”, the percentage by which wages earned by skilled workers exceed those of unskilled workers, varies among industries featuring different market competitiveness. We construct a theoretical model with CES utility function and constant...

We explore how public investment in commercial infrastructure affects the composition of trade between countries. To this end, we develop a model of bilateral trade in which two countries produce, consume, and trade a continuum of goods. Goods are produced by a single homogeneous factor, labor,...