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Trade Liberalization and the Wage Skill Premium: Evidence from Indonesia

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  • Amiti, Mary
  • Cameron, Lisa

Abstract

In this paper, we analyze the effect of reducing import tariffs on intermediate inputs and final goods on the wage skill premium within firms in Indonesia – a country with a high share of unskilled workers. We present a new finding that reducing input tariffs reduces the wage skill premium within firms that import their intermediate inputs. However, we do not find significant effects from reducing tariffs on final goods on the wage skill premium within firms.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of International Economics.

Volume (Year): 87 (2012)
Issue (Month): 2 ()
Pages: 277-287

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Handle: RePEc:eee:inecon:v:87:y:2012:i:2:p:277-287

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Web page: http://www.elsevier.com/locate/inca/505552

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Keywords: wage inequality; skill premium; import tariffs; intermediate inputs;

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References

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Citations

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Cited by:
  1. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2012. "The Empirics of Firm Heterogeneity and International Trade," Working Papers 12-18, Center for Economic Studies, U.S. Census Bureau.
  2. Baumgarten, Daniel, 2013. "Exporters and the rise in wage inequality: Evidence from German linked employer–employee data," Journal of International Economics, Elsevier, vol. 90(1), pages 201-217.
  3. Kis-Katos, Krisztina & Sparrow, Robert, 2013. "Poverty, Labour Markets and Trade Liberalization in Indonesia," IZA Discussion Papers 7645, Institute for the Study of Labor (IZA).
  4. Aldaba, Rafaelita M., 2013. "Impact of Trade Liberalization on Wage Skill Premium in Philippine Manufacturing," Discussion Papers DP 2013-25, Philippine Institute for Development Studies.
  5. Crinò, Rosario, 2012. "Imported inputs and skill upgrading," Labour Economics, Elsevier, vol. 19(6), pages 957-969.
  6. Hiroyuki Kasahara & Yawen Liang & Joel Rodrigue, 2013. "Does Importing Intermediates Increase the Demand for Skilled Workers? Plant-level Evidence from Indonesia," CESifo Working Paper Series 4463, CESifo Group Munich.
  7. Massimiliano Calì, 2012. "Trade Liberalisation Does Not Always Raise Wage Premia: Evidence from Ugandan Districts," SERC Discussion Papers 0114, Spatial Economics Research Centre, LSE.
  8. Sadayuki Takii & Dionisius Narjoko, . "Revisiting How Globalization Affects Wage Skill Premium in Indonesia Manufacturing," Chapters, Economic Research Institute for ASEAN and East Asia (ERIA).
  9. Archanun Kohpaiboon & Juthatip Jongwanich, . "Global Production Sharing and Wage Premium: Evidence from Thai Manufacturing," Chapters, Economic Research Institute for ASEAN and East Asia (ERIA).
  10. Ana Cecília Fieler & Marcela Eslava & Daniel Xu, 2014. "Trade, Skills, and Quality Upgrading: A Theory with Evidence from Colombia," NBER Working Papers 19992, National Bureau of Economic Research, Inc.
  11. Winters, L. Alan, 2014. "Globalization, Infrastructure, and Inclusive Growth," ADBI Working Papers 464, Asian Development Bank Institute.
  12. Chin Hee Hahn & Dionisius Narjoko, . "Introduction and Overview," Chapters, Economic Research Institute for ASEAN and East Asia (ERIA).
  13. Liu, Dan, 2013. "International trade and wage inequality: A non-monotonic relationship," Economics Letters, Elsevier, vol. 121(2), pages 244-246.
  14. Tanaka, Ayumu, 2013. "The causal effects of exporting on domestic workers: A firm-level analysis using Japanese data," Japan and the World Economy, Elsevier, vol. 28(C), pages 13-23.
  15. Jayanthakumaran, Kankesu & Sangkaew, Piyapong & O’Brien, Martin, 2013. "Trade liberalisation and manufacturing wage premiums: Evidence from Thailand," Journal of Asian Economics, Elsevier, vol. 29(C), pages 15-23.

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