Handel, Technologie und Beschäftigung

The authors analyze the relationship between the upsurge in inter- and intraindustry trade and the growing unemployment of less-skilled workers in Germany. In Heckscher-Ohlin trade theory, interindustry trade and wages are linked solely through changes in product prices. As a consequence, the long-term shift in prices for human capital-intensive and labor-intensive goods was used as a measure of the employment effects of interindustry trade. The empirical results show that the effects of interindustry trade on the German labor market seem to be rather small. However, additional empirical tests reveal that tariff and nontariff trade barriers of the EU as well as a skill-biased technological progress could be responsible for the observed trend in relative product prices and thus give rise to an underestimation of the trade effects.
In addition, it can be assumed that an upsurge in intraindustry trade results in a growing unemployment of less-skilled workers if a large part of reciprocal trade in product groups is based on the exchange of goods characterized by different quality levels and if the home country specializes in the production of high-quality products.