This study deals with the effects of labor-market distortions on the estimates of human capital used in studying U.S. trade flows. The initial concern was that the levels of human capital attributed to highly concentrated and unionized industries might be erroneously high. This could alter regression estimates not only of the effect of human capital on net exports, but also of other coefficients in the equation. The results of the analysis suggested, however, that when the possibility of distortions is taken into consideration, the signs of the coefficients are unaltered, although some change is evident in their magnitude.
ASJC Scopus subject areas
- Economics and Econometrics