Several investigators have studied the role of import competition in explaining wage behavior, with apparently conflicting results: Some have found a significant effect of import competition on wages in manufacturing, while others have found no such effect in the aggregate. This paper highlights the role of the nontradable goods sector--not addressed in previous studies--to reconcile these results. The model demonstrates that a fall in the relative price of tradable goods has an ambiguous effect on aggregate real wages: while the lower price of tradable goods leads to lower labor demand in the tradable sector, it also leads to higher labor demand in the nontradable sector. Empirical results show considerable support for the model when tradable goods prices are measured by import or export prices, but not when they are measured by the real exchange rate.

This paper utilizes a detailed data set on most U.S. car models over a twenty-two-year period to determine the impact of advertising and product styling. It finds that, while advertising and style change each increases a model's sales, advertising is short-lived but styling has a much longer impact. Rivals' styling reduces own-model sales to the point that the overall market effect is self-canceling. Rivals' advertising, by contrast, does not greatly affect own sales, so that marketwide advertising does increase total sales. These results add several twists to previous analyses of this industry.

Reza M. Ramazani, Keith E. Maskus, A Test of the Factor Endowments Model of Trade in a Rapidly Industrializing Country: The Case of Korea, The Review of Economics and Statistics, Vol. 75, No. 3 (Aug., 1993), pp. 568-572

This paper extends the work of Boyd (1987) by examining the question of efficiency in Yugoslavian agricultural production using the stochastic production frontier. We find the private sector produces with higher output efficiency than the social sector. Next, we examine regional efficiency differences. Our findings reinforce earlier analysis of the economic impact of regional development policy pursued in Yugoslavia. Less developed republics appeared unable to utilize efficiently the large volume of investment resources allocated from the more developed republics via the central government.

Maureen L. Cropper, Leland Deck, Nalin Kishor, Kenneth E. McConnell, Valuing Product Attributes Using Single Market Data: A Comparison of Hedonic and Discrete Choice Approaches, The Review of Economics and Statistics, Vol. 75, No. 2 (May, 1993), pp. 225-232

Developing countries often tax agriculture heavily, a practice that might affect the productivity as well as the quantity of resources allocated to agriculture. A variable-coefficient, cross-country agricultural production function is estimated, with past price expectations among the determinants of the production coefficients. Productivity's responsiveness to those expectations implies that had these developing economies eliminated price interventions, agricultural productivity would have increased on average by about a fourth.