Trade raises the relative wage of unskilled workers, whether the outcome is diversified or specialized. But the effects on wages of subsequent changes in the relative domestic supply of labor differ. In a diversified country (as at Sj), rela- tive wages are fixed by relative world prices, at the level w1. Changes in the domestic labor supply, unless they are big enough to affect world prices, do not change relative wages: they alter only the composition of output and trade. By contrast, in a specialized country on a downward-sloping segment of DD, as at S2, changes in domestic labor supply do affect relative wages. For instance, an increase in the relative number of skilled workers would raise the relative wage of unskilled labor.