What are the Results of Product-Price Studies and What Can We Learn from Their Differences?

45 Pages Posted: 10 Jun 2000 Last revised: 9 Oct 2010

See all articles by Matthew J. Slaughter

Matthew J. Slaughter

Dartmouth College - Tuck School of Business; National Bureau of Economic Research (NBER)

Date Written: June 1998

Abstract

In recent years many economists have analyzed whether international trade has contributed to rising U.S. wage inequality by changing relative product prices. In this paper I survey the findings of nine product-price' studies which together demonstrate how the methodology of product-price studies has evolved. I then synthesize the findings of these nine studies and draw two main conclusions. The first conclusion is that this literature has a refined set of empirical strategies for applying the Stolper-Samuelson theorem to the data from which important methodological lessons can be learned. The second main conclusion is that despite the methodological progress that has been made, research to date still has fundamental limitations regarding the key question of how much international trade has contributed to rising wage inequality. Most importantly, more work needs to link exogenous forces attributable to international trade to actual product-price changes.

Suggested Citation

Slaughter, Matthew J., What are the Results of Product-Price Studies and What Can We Learn from Their Differences? (June 1998). NBER Working Paper No. w6591. Available at SSRN: https://ssrn.com/abstract=226315

Matthew J. Slaughter (Contact Author)

Dartmouth College - Tuck School of Business ( email )

Hanover, NH 03755
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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