Trade and inequality, revisited Paul Krugman The NAFTA vote, 1993 - - PowerPoint PPT Presentation

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Mar 12, 2023 355 likes •584 views

Trade and inequality, revisited Paul Krugman The NAFTA vote, 1993 Ayes Noes Democrats 102 156 Republicans 132 43 CAFTA VOTE, 2005 AYES NOES REPUBLICAN 202 27 15 187 DEMOCRATIC 1 INDEPENDENT TOTALS 217 215 The pact faces

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Trade and inequality, revisited

Paul Krugman

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Ayes Noes Democrats 102 156 Republicans 132 43

The NAFTA vote, 1993

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AYES NOES

REPUBLICAN

202 27

DEMOCRATIC

15 187

INDEPENDENT

1 TOTALS 217 215 CAFTA VOTE, 2005 The pact faces near-unanimous opposition by Democrats, who charge it fails to offer adequate labor protections. It also faces opposition or misgivings by Republicans from districts with large numbers of sugar producers, textile makers and other manufacturers - Marketwatch

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1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1 9 7 3 1 9 7 5 1 9 7 7 1 9 7 9 1 9 8 1 1 9 8 3 1 9 8 5 1 9 8 7 1 9 8 9 1 9 9 1 1 9 9 3 1 9 9 5 1 9 9 7 1 9 9 9 2 1 2 3 2 5

College-high school wage ratio

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From John Romalis, AER 2004

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From “Growing world trade: causes and consequences”, 1995

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1 2 3 4 5 6 1970 1990 % of GDP

Imports of manufactures from NIEs

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From “Growing world trade: causes and consequences”, 1995 Bernanke, this year: Unfortunately, much of the available empirical research on the influence

f trade on earnings inequality dates from the 1980s and 1990s and thus

does not address later developments. Whether studies of the more-recent period will reveal effects of trade on the distribution of earnings that differ from those observed earlier is to some degree an open question.

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1 2 3 4 5 6 1970 1990 2005 % of GDP

Imports of manufactures from NIEs

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From Romalis 2004

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Relative trading partner wages

10 20 30 40 50 60 70 80 1975 1990 2005 % of US

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“Growing world trade,” again

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H L Outsourcing made simple (really): Samuelson’s angel Computers Apparel

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H L The angel’s wrath … Factor price equalization North South

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H L Bundling North South L-intensive activities in computers H-intensive activities in apparel FPE

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25% 30% 35% 40% 45% 50% 1917 1922 1927 1932 1937 1942 1947 1952 1957 1962 1967 1972 1977 1982 1987 1992 1997 2002 Share (in %), excluding capital gains

Top decile share

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5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 1913 1918 1923 1928 1933 1938 1943 1948 1953 1958 1963 1968 1973 1978 1983 1988 1993 1998 2003 Share (in %), excluding capital gains P90-95 P95-99 P99-100

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