Trade Shocks and Local Labor Markets' Linkages: Theory and Evidence

In the past few years, there has been a concern among economists and policy makers that increased openness to international trade affects some regions in a country more than others. Recent research has found that local labor markets more exposed to import competition through their initial employment composition experience worse outcomes in several dimensions such as, employment, wages, and poverty. Although there is evidence that regions within a country exhibit variation in the intensity with which they trade with each other and with other countries, trade linkages have been ignored in empirical analyses of the regional effects of trade, which focus on differences in employment composition. In this dissertation, I investigate how local labor markets' trade linkages shape the response of wages to international trade shocks. In the second chapter, I lay out a standard multi-sector general equilibrium model of trade, where domestic regions trade with each other and with the rest of the world. Using this benchmark, I decompose a region's wage change resulting from a national import cost shock into a direct effect on prices, holding other endogenous variables constant, and a series of general equilibrium effects. I argue the direct effect provides a natural measure of exposure to import competition within the model since it summarizes the effect of the shock on a region's wage as a function of initial conditions given by its trade linkages. I call my proposed measure linkage exposure while I refer to the measures used in previous studies as employment exposure. My theoretical analysis also shows that the assumptions previous studies make on trade linkages are not consistent with the standard trade model. In the third chapter, I calibrate the model to the Brazilian economy in 1991--at the beginning of a period of trade liberalization--to perform a series of experiments. In each of them, I reduce the Brazilian import cost by 1 percent in a single sector and I calculate how much of the cross-regional variation in counterfactual wage changes is explained by exposure measures. Over this set of experiments, employment exposure explains, for the median sector, 2 percent of the variation in counterfactual wage changes while linkage exposure explains 44 percent. In addition, I propose an estimation strategy that incorporates trade linkages in the analysis of the effects of trade on observed wages. In the model, changes in wages are completely determined by changes in market access, an endogenous variable that summarizes the real demand faced by a region. I show that a linkage measure of exposure is a valid instrument for changes in market access within Brazil. By using observed wage changes in Brazil between 1991-2000, my estimates imply that a region at the 25th percentile of the change in domestic market access induced by trade liberalization, experiences a 0.6 log points larger wage decline (or smaller wage increase) than a region at the 75th percentile. The estimates from a regression of wages changes on exposure imply that a region at the 25th percentile of exposure experiences a 3 log points larger wage decline (or smaller wage increase) than a region at the 75th percentile. I conclude that estimates based on exposure overstate the negative impact of trade liberalization on wages in Brazil. In the fourth chapter, I extend the standard model to allow for two types of workers according to their education levels: skilled and unskilled. I show that there is substantial variation across Brazilian regions in the skill premium. I use the exogenous variation provided by tariff changes to estimate the impact of market access on the skill premium. I find that decreased domestic market access resulting from trade liberalization resulted in a higher skill premium. I propose a mechanism to explain this result: that the manufacturing sector is relatively more intensive in unskilled labor and I show empirical evidence that supports this hypothesis.

TRANSCENDING FACH: A SEARCH FOR IDENTITY INSIDE AND OUT OF MEZZO-SOPRANO REPERTOIRE

The German Fach system is a tool to classify voices in classical singing. This dissertation comprises three different programs that reflect my search for identity as a mezzo-soprano and my desire to transcend the limitations of Fach. The three programs, all presented at The Clarice Performing Arts Center, contain repertoire written for male and female voices thus allowing me to explore areas outside of the mezzo-soprano Fach, gain a better understanding of the Fach system and guide me as I strive to become a more mature performer. In my first program, I sang the role of Sesto, a role that was composed originally for a castrate, in the opera La Clemenza di Tito by W.A. Mozart. The Maryland Opera Studio production took place April 30, May 2,4&6,2003. Performing this gender-bending role provided an experience of physical behavior from the male view point along with the demands of coloratura singing. Program two (November 30,2004) contained the song cycle Dichterliebe by Robert Schumann and songs by Ludwig van Beethoven, Franz Schubert and Felix Mendelssohn, which are usually sung by male voices. This program experimented with extended range, tessitura and a gender-bending performance in the art song arena. 8 In program three (April 21 &23,2005), I sang the contralto role of Cornelia from Giulio Cesare in Egitto by George Frederic Handel. The role of Cornelia is psychologically complex, expressing emotions such as love, melancholy, rage, malice, joy and fear. To convey these emotions a voice needs warmth and darkness of quality. Although the range is close to that of the mezzo-soprano, Handel wrote Cornelia for contralto voice because he wanted a dark timbre and this role allowed me to develop my lower register and manage suitable ornamentations. The programs are documented in a digital format available on compact disc and are accompanied by the oral presentation at the defense of this dissertation.