FREE-TRADE AGREEMENTS AND INTERREGIONAL LABOR MIGRATION - THE CASE OFTHE US AND CANADA

This paper focuses on the different effects that trade policy have on distinctive regions within a country by modeling the subnational impac t of the Free Trade Agreement between the U.S. and Canada using an app lied general equilibrium model. This study incorporates interregional labor mobility into the model and, by comparing the new results to tho se measured in the absence of labor migration, shows the importance of allowing for interregional labor mobility when modeling at the subnat ional level the effects of nationality of internationally designed pol icies.