Munich Personal RePEc Archive

Successive Trade Liberalization and Wage Inequality

Acharyya, Rajat (2010): Successive Trade Liberalization and Wage Inequality. Published in: Keio Economic Studies , Vol. 46, (2010): pp. 29-42.


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This paper examines the implications of initial conditions in terms of the levels of tariff protection from which countries liberalize their trade regimes on the wage inequality in trading nations. The discussion is confined to the standard two-country Heckscher-Ohlin-Samuelson model to see whether there can be channels, other than those discussed in the recent literature, through which the observed phenomena can be theoretically predicted. The initial conditions are observed to matter in the sense that for countries lowering their tariff levels successively than once and for all, intra-country wage inequality may change asymmetrically at different stages of liberalization.

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