International Trade and Labor Income Risk in the United States
39 Pages Posted: 26 May 2009 Last revised: 19 Dec 2022
Date Written: May 2009
Abstract
This paper studies empirically the links between international trade and labor income risk faced by workers in the United States. We use longitudinal data on workers to estimate time-varying individual income risk at the industry level. We then combine our estimates of persistent labor income risk with measures of exposure to international trade to analyze the relationship between trade and labor income risk. Importantly, by contrasting estimates from various sub-samples of workers, such as those who switched to a different industry (or sector) with those who remained in the same industry throughout the sample, we study the relative importance of the different channels through which international trade affects individual income risk. Finally, we use these estimates to conduct a welfare analysis evaluating the benefits or costs of trade through the income risk channel. We find import penetration to have a statistically significant association with labor income risk in the United States, with economically significant welfare effects.
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Income Risk, Income Mobility and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Income Risk, Income Mobility and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Income Risk, Income Mobility and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Trade Policy, Income Risk, and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Trade Policy, Income Risk, and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Trade Policy, Income Risk, and Welfare
By Tom Krebs, Pravin Krishna, ...
-
Estimating Individual Vulnerability to Poverty with Pseudo-Panel Data
By Francois Bourguignon, Chor-ching Goh, ...
-
Labour Markets in EMU - What Has Changed and What Needs to Change