Intra-industry trade, involuntary unemployment and macroeconomic stability
Autor(a) principal: | |
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Data de Publicação: | 2021 |
Outros Autores: | , |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
Texto Completo: | http://hdl.handle.net/10400.14/36152 |
Resumo: | We introduce taste for variety in a one-sector model of differentiated products with productive labor externalities, considering two OLG countries, one with wage rigidity and the other with full employment. After opening the borders to capital mobility and intra-industry trade, steady state output and real wages improve in the full employment country and the saddle path stability, characterizing this country under autarky, will prevail in the globalized world if this economy is big enough. Unemployment increases in the country with wage rigidity and, for intermediate plausible values of both the current propensity to consume and of the labor externality, indeterminacy, which emerges in the rigid wage economy in autarky, will be exported to the world if this country is relatively big. Finally, we show that globalization leads to the appearance of stable deterministic cycles in activity, employment and the trade account, both through flip and Hopf bifurcations, when the world steady state is locally determinate, for empirically plausible low degrees of labor externalities. This implies that trade cycles occur in the absence of shocks to fundamentals, and even without uncertainty in expectations. |
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Intra-industry trade, involuntary unemployment and macroeconomic stabilityBifurcationsIndeterminacyIntra-industry tradeInvoluntary unemploymentTaste for varietyWe introduce taste for variety in a one-sector model of differentiated products with productive labor externalities, considering two OLG countries, one with wage rigidity and the other with full employment. After opening the borders to capital mobility and intra-industry trade, steady state output and real wages improve in the full employment country and the saddle path stability, characterizing this country under autarky, will prevail in the globalized world if this economy is big enough. Unemployment increases in the country with wage rigidity and, for intermediate plausible values of both the current propensity to consume and of the labor externality, indeterminacy, which emerges in the rigid wage economy in autarky, will be exported to the world if this country is relatively big. Finally, we show that globalization leads to the appearance of stable deterministic cycles in activity, employment and the trade account, both through flip and Hopf bifurcations, when the world steady state is locally determinate, for empirically plausible low degrees of labor externalities. This implies that trade cycles occur in the absence of shocks to fundamentals, and even without uncertainty in expectations.Veritati - Repositório Institucional da Universidade Católica PortuguesaRiche, Antoine LeLloyd-Braga, TeresaModesto, Leonor2021-12-13T10:04:57Z2022-03-012022-03-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.14/36152eng0304-406810.1016/j.jmateco.2021.10258985120088087000767237100006info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2024-01-16T01:42:50Zoai:repositorio.ucp.pt:10400.14/36152Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T18:29:21.544156Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse |
dc.title.none.fl_str_mv |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
title |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
spellingShingle |
Intra-industry trade, involuntary unemployment and macroeconomic stability Riche, Antoine Le Bifurcations Indeterminacy Intra-industry trade Involuntary unemployment Taste for variety |
title_short |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
title_full |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
title_fullStr |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
title_full_unstemmed |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
title_sort |
Intra-industry trade, involuntary unemployment and macroeconomic stability |
author |
Riche, Antoine Le |
author_facet |
Riche, Antoine Le Lloyd-Braga, Teresa Modesto, Leonor |
author_role |
author |
author2 |
Lloyd-Braga, Teresa Modesto, Leonor |
author2_role |
author author |
dc.contributor.none.fl_str_mv |
Veritati - Repositório Institucional da Universidade Católica Portuguesa |
dc.contributor.author.fl_str_mv |
Riche, Antoine Le Lloyd-Braga, Teresa Modesto, Leonor |
dc.subject.por.fl_str_mv |
Bifurcations Indeterminacy Intra-industry trade Involuntary unemployment Taste for variety |
topic |
Bifurcations Indeterminacy Intra-industry trade Involuntary unemployment Taste for variety |
description |
We introduce taste for variety in a one-sector model of differentiated products with productive labor externalities, considering two OLG countries, one with wage rigidity and the other with full employment. After opening the borders to capital mobility and intra-industry trade, steady state output and real wages improve in the full employment country and the saddle path stability, characterizing this country under autarky, will prevail in the globalized world if this economy is big enough. Unemployment increases in the country with wage rigidity and, for intermediate plausible values of both the current propensity to consume and of the labor externality, indeterminacy, which emerges in the rigid wage economy in autarky, will be exported to the world if this country is relatively big. Finally, we show that globalization leads to the appearance of stable deterministic cycles in activity, employment and the trade account, both through flip and Hopf bifurcations, when the world steady state is locally determinate, for empirically plausible low degrees of labor externalities. This implies that trade cycles occur in the absence of shocks to fundamentals, and even without uncertainty in expectations. |
publishDate |
2021 |
dc.date.none.fl_str_mv |
2021-12-13T10:04:57Z 2022-03-01 2022-03-01T00:00:00Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10400.14/36152 |
url |
http://hdl.handle.net/10400.14/36152 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
0304-4068 10.1016/j.jmateco.2021.102589 85120088087 000767237100006 |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
application/pdf |
dc.source.none.fl_str_mv |
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação instacron:RCAAP |
instname_str |
Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
instacron_str |
RCAAP |
institution |
RCAAP |
reponame_str |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
repository.name.fl_str_mv |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
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1799132013732560896 |