Skip to content

Research Paper WTO Working Papers ERSD-2017-15

Trade, technology, and prosperity: an account of evidence from a labor-market perspective


Publication date

Nov 2017


This report assesses the state of economic research into those areas, with a particular focus on empirical methodologies and their adequacy for an assessment of general-equilibrium outcomes. While difference-in-differences techniques and instrumental- variable approaches provide answers, they exhibit shortcomings that limit conclusiveness. Recent advances in structural estimation of multi-country and multisector models that allow for reallocation frictions in domestic labor markets hold promise to deliver more definite empirical answers. Interestingly, a conclusion from a two-decades old strand of literature seems to be vindicated by conclusions from a related recent literature: roughly one-quarter of changes in labor-market outcomes (wage inequality then and manufacturing job losses now) was predicted by trade integration and roughly one-third by technological change. The remainder of changes in labor-market outcomes remains unaccounted. The report offers candidate explanations, rooted in recent evidence, how interactions between globalization, technological progress, and structural change may account for that remainder.


Science And Technology, Labour Market, Economics, Research, Wages And Earnings, and International Economic Relations



Research home

Research home


Latest findings, new research

Publications search

Search all research by subject and author


Researchers discuss their findings and what they mean for society


Background and context, methods and data, aims and outputs


Conferences, seminars and workshops

Survey methodology

Specialist research, practice and study

Taking the long view

ISER's annual report


Key research themes and areas of interest