Edward Elgar Publishing Trade, Jobs and Wages

The world’s increasing integration through trade and the persistence of high unemployment in Europe, and other areas of the world, highlight the need to understand the implications of free trade for unemployment. Trade, Jobs and Wages analyses how employment levels and real wages are affected by international trade.Popular trade theory disregards the impact of free trade on the rate of unemployment, since it assumes full employment at the outset. By focusing on the determinants of the natural rate of unemployment, Professor Hoon places an emphasis on real, as opposed to monetary, factors in accounting for long term trends in wages and unemployment. The author examines the influence of trade on jobs and wages in different theoretical settings, including the Ricardian and Heckscher–Ohlin models as well as models exhibiting imperfect competition and scale economies. The influence of trade on high wage jobs and wage inequalities is also discussed. Review ‘Although reams of paper have been dedicated to East Asia’s rapid productivity growth in recent decades, no one had explored at all deeply the other dimension of the Asian miracle – the extraordinarily low unemployment rates achieved. In this masterful book Hian Teck Hoon explains that it is structural unemployment that is so low there, not deficient demand. Then, skilfully combining concepts in the endogenous theory of the natural rate of unemployment with concepts in trade theory, Hoon explains that it was the opening up to trade that brought down the natural rate in East Asia. The effects on the wage gap and the unemployment pattern are brought in. Thus the book both extends employment theory and enriches the theory of the gains from trade.’ -- Edmund S. Phelps, Columbia University, US About the Author Hian Teck Hoon, formerly Associate Professor, Department of Economics, National University of Singapore, Singapore