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Distributional Effects of International Trade : Misconceptions about Losses and Gains (English)

International trade increases efficiency but also redistributes income, thus creating winners and losers. To account for the total impact and calculate redistributive effects correctly and fully, the different channels of gains and losses must be measured precisely. This Brief shows that measuring the gains is often much more challenging than measuring the losses, generating misconceptions and an overstatement of the adverse impacts of international trade. To assess the effects of trade shocks objectively, and to promote effective policy options, policy makers must be aware of thelimitations in data and methodology surrounding the research on the distributional effects of international trade, and the misconceptions that ensue.


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    Distributional Effects of International Trade : Misconceptions about Losses and Gains

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    International Trade; import-competing industry; principles of political economy; labor market friction; local labor market; impact of trade; export industry; labor mobility; lack of interest; change in welfare; number of workers; development research group; patterns of consumption; Trade and Inequality; liberalization of trade; rapid export growth; gains and losses; redistribution of wealth; price of good; trade adjustment assistance; mobility worker; labor market policy; trade shock; comparative advantage; income loss; change in income; welfare gains; percent change; income channel; annual wage; export sector; positive impact; urban worker; partial equilibrium; natural science; treatment group; quite simple; middle age; in economics; trade gains; technological progress; income note; traded goods; rice production; particular country; theoretical model; empirical economics; agricultural production; rice industry; international economics; shock therapy; skill group; unanimous support; compensation mechanism; recent evidence; trade model; recent research; public support; household impact; Agricultural Trade; general equilibrium; real wage; Economic Studies; economic study; wage increase; statistical method; high concentration; new job; international economy; geographical location; recent work; special situation; experienced worker; worker type; popular empirical; increasing exports; upper bind; sustainable trade; knowledge spillover; average price; increasing trade; average consumption; lower price; living cost; research community; tradable good; sustainable policy; real income; income inequality; Social Sciences; income decline; skill set; policy option; academic research; consumption basket; apparel industry



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Distributional Effects of International Trade : Misconceptions about Losses and Gains (English). Research & Policy Briefs,no. 44 Washington, D.C. : World Bank Group.