Abstract
We study how wage gaps across skills and the skill distribution in an economy respond to trade integration. Using administrative data of Denmark (1995–2011), we find that trade has a negative effect on the wage gap between secondary and primary education and a positive effect on the wage gap between tertiary and secondary education. We also show that trade affects skill distribution and induces skill polarization: trade has a positive effect on both the mean and standard deviation of skills. Wage-gap changes induced by trade shocks explain about 21%–30% of the effect of trade on skills.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 241-259 |
| Number of pages | 19 |
| Journal | Economic Inquiry |
| Volume | 58 |
| Issue number | 1 |
| DOIs | |
| State | Published - Jan 1 2020 |
ASJC Scopus subject areas
- Business, Management and Accounting(all)
- Economics and Econometrics
Fingerprint Dive into the research topics of 'TRADE-INDUCED SKILL POLARIZATION'. Together they form a unique fingerprint.
Cite this
Gu, G. W., Malik, S., Pozzoli, D., & Rocha, V. (2020). TRADE-INDUCED SKILL POLARIZATION. Economic Inquiry, 58(1), 241-259. https://doi.org/10.1111/ecin.12834