تأخیر و پویایی در تنظیم بازار کار: نتایج شبیه سازی

We simulate numerically a trade model with labor mobility costs added, modeled in such a way as to generate gross flows in excess of net flows. Adjustment to a trade shock can be slow with plausible parameter values. In our base case, the economy moves 95% of the distance to the new steady state in approximately eight years. Gross flows have a large effect on this rate of adjustment and on the normative effects of trade. Announcing and delaying the liberalization can build – or destroy – a constituency for free trade. We study the conditions under which these contrasting outcomes occur.

Despite its importance, the imperfect mobility of workers within their economy has usually been ignored in research on international trade. Familiar workhorse models assume either perfect mobility or (less often) perfect immobility of workers across sectors. This paper studies a recent theoretical model that has been designed to address this gap, by simulating the model numerically to generate answers to questions that are difficult to resolve analytically. Cameron, Chaudhuri and McLaren (2007) present a model of a small open economy with workers who face moving costs to switch sectors or to move geographically within the country. These costs have a common component and a time-varying idiosyncratic component. Workers must choose their location at each date, which amounts to a problem of investment under uncertainty with rational expectations. The presence of the idiosyncratic shocks means that the model produces gross flows in excess of net flows, gradual adjustment of the economy to a trade shock, anticipatory adjustment to an expected future shock, and long-run wage differentials across sectors and locations, all of which are important

We have studied numerical simulations of a standard trade model with labor mobility costs added, modeled in such a way as to generate gross flows in excess of net flows. Major conclusions can be summarized as follows. (1) Adjustment to a trade shock can take a long time with plausible values of parameter values. In our base case, for the economy to move 95% of the distance to the new steady state took approximately eight years. (2) Gross flows matter a great deal. In our model version with high gross flows (the ‘high variance' model of Section 3), there was very little net movement of workers, so trade liberalization resulted in a sharp rise in wage in the one sector and a sharp drop in the other in the short run and in the long one. However, because of the high mobility of workers, actual welfare of workers even in the import-competing sector rose. On the other hand, with low gross flows (the ‘low variance’ model), long-run net movement of workers is large, but the adjustment takes more than 40 years. Thus, empirical estimates of the parameters that govern rates of gross flow would be valuable in studying hypothetical policy changes through simulation. (3) Announcing and delaying the liberalization can build a constituency for free trade, but it can also destroy one. We have studied the conditions under which these two different outcomes occur. Along the way, we have shown how equilibrium in this model can be computed and a variety of policy experiments simulated, illustrating techniques that can then be applied to a wide variety of policy questions.