Details

Autor(en) / Beteiligte

• Krishna, Pravin
• Poole, Jennifer P.
• Senses, Mine Zeynep

Titel

Wage Effects of Trade Reform with Endogenous Worker Mobility

Ist Teil von

• Journal of international economics, 2014-07, Vol.93 (2), p.239-252

Ort / Verlag

Amsterdam: Elsevier B.V

Erscheinungsjahr

2014

Link zum Volltext

Quelle

Alma/SFX Local Collection

Beschreibungen/Notizen

• In this paper, we use a linked employer–employee database from Brazil to evaluate the wage effects of trade reform. With an aggregate (firm-level) analysis of this question, we find that a decline in trade protection is associated with an increase in average wages in exporting firms relative to domestic firms, consistent with earlier studies. However, using disaggregated, employer–employee level data, and allowing for the endogenous assignment of workers to firms due to match-specific productivity, we find that the premium paid to workers at exporting firms is economically and statistically insignificant, as is the differential impact of trade openness on the wages of workers at exporting firms relative to otherwise identical workers at domestic firms. We also find that workforce composition improves systematically in exporting firms, in terms of the combination of worker ability and the quality of worker–firm matches, post-liberalization. These results stand in stark contrast to the findings reported in many earlier studies and underscore the importance of endogenous matching and, more generally, non-random labor market allocation mechanisms, in determining the effects of trade policy changes on wages. •Brazilian labor data reject the exogeneity of worker–firm matches.•The exporter wage premium is economically and statistically insignificant.•The differential impact of trade openness on wages at exporting firms is insignificant.•The workforce composition improves in exporting firms after trade liberalization.•Labor market allocation mechanisms are crucial in determining wages.