TY  - JOUR
AU  - Zhu,Susan Chun
AU  - Trefler,Daniel
TI  - Ginis in General Equilibrium: Trade, Technology and Southern Inequality
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 8446
PY  - 2001
Y2  - August 2001
UR  - http://www.nber.org/papers/w8446
L1  - http://www.nber.org/papers/w8446.pdf
N1  - Author contact info:
Susan Chun Zhu
Michigan State University
E-Mail: zhuc@msu.edu

Daniel Trefler
Rotman School of Management
University of Toronto
105 St. George Street
Toronto, ON M5S 3E6
CANADA
Tel: 416/946-7945
Fax: 416/978-5433
E-Mail: dtrefler@rotman.utoronto.ca
AB  - Within developing and newly industrialized countries, rising wage inequality is both common and highly correlated with export growth. This is incompatible with the Stolper-Samuelson theorem, but suggestive of a role for technological catch-up. We develop this insight using a model that features both Ricardian and endowments-based comparative advantage. In this model Southern catch-up induces a correlation between rising inequality and export growth. It also induces a shift in trade patterns that results in skill upgrading and rising inequality in both the South and the North. A rudimentary empirical exercise reveals that, as predicted, Southern skill upgrading is correlated with the trade-weighted average rate of Southern catch-up.
ER  -