TY  - JOUR
AU  - Krishna,Kala
AU  - Yavas,Cemile
TI  - When Does Trade Hurt? Market, Transition and Developing Economies
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 8995
PY  - 2002
Y2  - June 2002
UR  - http://www.nber.org/papers/w8995
L1  - http://www.nber.org/papers/w8995.pdf
N1  - Author contact info:
Kala Krishna
Department of Economics
523 Kern Graduate Building
The Pennsylvania State University
University Park, PA 16802
Tel: 814/865-1106
Fax: 814/863-4775
E-Mail: kmk4@psu.edu
AB  - This paper argues that labor market distortions in transition and developing economies help explain differential impacts of trade liberalization. We assume that workers differ in ability. In a market economy their earnings depend on their ability. However, earnings are independent of ability due to a common wage set in manufacturing in a transition economy and because of family farms in a developing economy. Our work suggests that trade liberalization without structural reform can have serious adverse effects in transition and developing economies: there can even be mutual losses from trade.
ER  -