TY - JOUR
T1 - Occupations and import competition
T2 - Evidence from Denmark
AU - Traiberman, Sharon
N1 - Funding Information:
Penny Goldberg was the coeditor for this article. I thank Stephen Redding and Jan De Loecker for their support and guidance in this project. I thank Kirill Evdokimov, Chris Flinn, Bo Honoré, Elena Manresa, Ricardo Reyes-Heroles, and participants at numerous workshops, and five anonymous referees for helpful discussions and comments. I am particularly indebted to Frederic Warzynski, Henning Bunzel, and the Labor Market Dynamics Group at Aarhus University. I have received support from the Princeton International Economics Section and the Cowles Foundation. I declare that I have no relevant or material financial interests that relate to the research described in this paper.
Funding Information:
* Department of Economics, New York University, 19 W. 4th Street, 8th Floor, New York, NY 10012 (email: [email protected]). Penny Goldberg was the coeditor for this article. I thank Stephen Redding and Jan De Loecker for their support and guidance in this project. I thank Kirill Evdokimov, Chris Flinn, Bo Honoré, Elena Manresa, Ricardo Reyes-Heroles, and participants at numerous workshops, and five anonymous referees for helpful discussions and comments. I am particularly indebted to Frederic Warzynski, Henning Bunzel, and the Labor Market Dynamics Group at Aarhus University. I have received support from the Princeton International Economics Section and the Cowles Foundation. I declare that I have no relevant or material financial interests that relate to the research described in this paper.
Publisher Copyright:
© 2019 American Economic Association. All rights reserved.
PY - 2019/12
Y1 - 2019/12
N2 - I argue that the winners and losers from trade are decided primarily by occupation. In addition to fixed adjustment costs, workers build up specific human capital over time that is destroyed when they must change occupations. I show that ignoring human capital biases estimates of adjustment costs upward by a factor of 3. Estimating an occupational choice model of the Danish labor market, I show that 57 percent of the dispersion in worker outcomes is accounted for by occupations, and only 16 percent by sectors. Finally, the model suggests that rising import competition from 1995-2005 reduced lifetime earnings for 5 percent of workers.
AB - I argue that the winners and losers from trade are decided primarily by occupation. In addition to fixed adjustment costs, workers build up specific human capital over time that is destroyed when they must change occupations. I show that ignoring human capital biases estimates of adjustment costs upward by a factor of 3. Estimating an occupational choice model of the Danish labor market, I show that 57 percent of the dispersion in worker outcomes is accounted for by occupations, and only 16 percent by sectors. Finally, the model suggests that rising import competition from 1995-2005 reduced lifetime earnings for 5 percent of workers.
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U2 - 10.1257/aer.20161925
DO - 10.1257/aer.20161925
M3 - Article
AN - SCOPUS:85075992377
SN - 0002-8282
VL - 109
SP - 4260
EP - 4301
JO - American Economic Review
JF - American Economic Review
IS - 12
ER -