This paper builds up a two country model of trade and unemployment allowing for perfect mobility of capital across the … borders. Capital moves from the north to the south, which suffers from unemployment. A few basic policies related to lowering … of unemployment are discussed. In particular it is shown that larger tariff as well as smaller tax on foreign capital may …

until the advent of NAFTA. Intermediate goods play a key role in the theory of effective protection, the application of … substitution and rivalry. They saw labor migration from Mexico as one type of threat to American workers and globalization as … another. The welfare effect of globalization depends on whether it occurs in a country's exportables or importables industries …