February 10, 2020

helpman 2017

trade and inequality

fi rm wage component of inequality

systematic component

size and export status

positive exporter wage premium

two mechanisms self-selection ( firm selection into international trade)

market access (exporting feeds back into higher fi rm employment and wages)

however systematic component explains little variation

idiosyncratic component drives variation

my theory

what drives "self-selection" and "market-access"

is in the idiosyncratic component

regional capital market development X firm patient capital recipiency

interaction is access (unequal)

heterogenous firm-level comparative advantage

advantage in labor market adjustment after trade

interaction is politics (interest groups)

interaction is f(corporate governance)

the external environment in which firms operate

capital market environment and the legal and institutional system

corporate governance is the institutional condition that drives

the fi rm wage component of inequality

the positive exporter wage premium

and self-selection

and market access