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Export expansion, skill acquisition and industry specialization: evidence from china

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  • Li, Bingjing

Abstract

This paper studies the impact of export expansion due to the decline in tariffs faced by exporters on human capital accumulation across China. Following a theoretically consistent approach, I construct regional measures of high- and low-skill export demand shocks using the variation in initial industry composition across regions and differential skill intensities across industries. Using a sub-national data over the period 1990 to 2005, the empirical analysis shows that high-skill export shocks raise both high school and college enrollments, while low-skill export shocks depress both. These relationships appear to be attributable to the association between skill premium and skill demand embodied in export shocks. The amplified differences in skill abundance across regions reinforce the initial industry specialization patterns. These findings suggest a mutually reinforcing relationship between regional industry specialization and skill formation.

Suggested Citation

  • Li, Bingjing, 2018. "Export expansion, skill acquisition and industry specialization: evidence from china," Journal of International Economics, Elsevier, vol. 114(C), pages 346-361.
  • Handle: RePEc:eee:inecon:v:114:y:2018:i:c:p:346-361
    DOI: 10.1016/j.jinteco.2018.07.009
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    6. Jiang, Xuan & Kennedy, Kendall & Zhong, Jiatong, 2018. "When Opportunity Knocks: China's Open Door Policy and Declining Educational Attainment," MPRA Paper 89649, University Library of Munich, Germany, revised Oct 2018.
    7. Andrés César & Guillermo Falcone & Leonardo Gasparini, 2022. "Costs and Benefits of Trade Shocks: Evidence from Chilean Local Labor Markets," CEDLAS, Working Papers 0300, CEDLAS, Universidad Nacional de La Plata.
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    9. Feicheng Wang & Chris Milner & Juliane Scheffel, 2022. "Export destination and the skill premium: Evidence from Chinese manufacturing industries," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(2), pages 1057-1094, May.
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    18. Dai, Mi & Huang, Wei & Zhang, Yifan, 2020. "Persistent effects of initial labor market conditions: The case of China's tariff liberalization after WTO accession," Journal of Economic Behavior & Organization, Elsevier, vol. 178(C), pages 566-581.
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    More about this item

    Keywords

    Export expansion; human capital; industry composition; skill supply;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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