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The impact of global value chain integration on wages: evidence from matched worker-industry data in Thailand

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  • Sasiwimon Warunsiri Paweenawat

Abstract

Using a two-stage estimation of matched worker-industry data from 2000 to 2011, this study investigates the impact of global value chain (GVC) integration on wages and the skill premium in the 32 industries in Thailand, a country with recent heavy involvement in GVCs. This study employs foreign value added in both final and intermediate goods exports as a proxy for the degree of industry integration in GVCs and applies a panel fixed effects estimation on constructed panel data to investigate its relationship with wages. The main finding indicates that a higher level of industry integration with GVCs leads to higher wages and a higher skill premium, confirming the positive effect of GVC involvement on wages and the complementary effect of high demand for skilled workers in GVC-oriented industries in Thailand. Workers in industries with downstream position will earn a higher wage than those working in the upstream position.

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  • Sasiwimon Warunsiri Paweenawat, 2022. "The impact of global value chain integration on wages: evidence from matched worker-industry data in Thailand," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 27(4), pages 757-780, October.
    • Handle: RePEc:taf:rjapxx:v:27:y:2022:i:4:p:757-780
    DOI: 10.1080/13547860.2021.1915544
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    Cited by:

    1. Yu, Hui & Li, Huiru, 2023. "How does the global metal industry value network affect industrial structure upgrading ? The perspective of industry chain," Resources Policy, Elsevier, vol. 85(PB).

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