TY  - JOUR
AU  - Harrison,Ann
AU  - Hanson,Gordon
TI  - Who Gains from Trade Reform?  Some Remaining Puzzles
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6915
PY  - 1999
Y2  - January 1999
UR  - http://www.nber.org/papers/w6915
L1  - http://www.nber.org/papers/w6915.pdf
N1  - Author contact info:
Ann Harrison
Department of Agricultural
and Resource Econonmics
University of California, Berkeley
210 Giannini Hall
Berkeley, CA 94720
Tel: 510/643-9676
Fax: 510/643-8911
E-Mail: ann.harrison@berkeley.edu

Gordon H. Hanson
IR/PS 0519
University of California, San Diego
9500 Gilman Drive
La Jolla, CA  92093-0519
Tel: 858/822-5087
Fax: 858/534-3939
E-Mail: gohanson@ucsd.edu
AB  - This paper focuses on three unresolved issues with regard to the impact of trade reform.  First, many studies linking trade reform to long run growth are surprisingly fragile.  To illustrate the problems with this literature, we examine a popular measure of openness recently introduced by Sachs and Warner (1995).  We show that their measure fails to establish a robust link between more open trade policies and long run growth.  The second puzzle we identify is the small impact of trade reform on employment in developing countries.  Finally, we analyze evidence on the relationship between trade reform and rising wage inequality, focusing on the 1985 Mexican trade reform.  Wage inequality in Mexico rose after the reform, which is puzzling in a Heckscher-Ohlin context if Mexico has a comparative advantage in producing low skill-intensive goods.
ER  -