The magnification effect of trade on wages with endogenous technology

This paper shows that in a variation of Acemogluʹs [Q. J. Econ. 113 (1998) 1055] endogenous-technology model trade can have a large effect on wages; an effect exceeding the traditional magnification effect. A second result of the paper is that factors complementary to skilled and unskilled labor, such as venture capital or land, ultimately drive wage inequality.