Master of Science
Department or Program
The volume of trade between the US and developing nations has increased substantially over the past three decades. The resulting fluctuations in employment and wages of domestic and foreign workers, as well as export and import trends, are in agreement with
Hoeschker-Ohlin-Samuelson. We take as our base case the manufacturing industry. We find that the wages of unskilled relative to skilled US workers has increased, while overall employment of unskilled workers has decreased. We also look at a subsample of plants in the Mexican automobile industry following the implementation of NAFTA and find that exports and TFP growth have increased, in line with standard HOS theory.