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Gender Wage Gaps across Skills and Trade Openness

Author

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  • Sarra Ben Yahmed

    () (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS.)

Abstract

Several empirical studies have shown that the effect of openness on the gender wage gap depends on the skill requirement of the workplace. This paper offers a theoretical explanation to understand that finding. We integrate a statistical discrimination framework with the labour assignment approach to give general conditions under which the matching between firms and workers gives rise to a wider gender wage gap at the upper tail of the distribution, in accordance with empirical evidence. We further look at the effect of trade openness on the gender wage gap along the entire distribution. Workers’ characteristics vary in two dimensions, skills and job commitment. The inability to observe individual’s job commitment induces employers to base partly their decision on group average. Following the literature on labour and international trade, we assume that skills act as complements to technological upgrading. Exporting firms are more skill-intensive and pay higher wages; assuming further that worker’s job commitment is a complement to technological upgrading, we find that a reduction in trade costs increases wage inequality within-groups and has non-monotonic effects on between-group inequality. Trade openness reduces the gender wage gap among unskilled workers but increases the gender wage gap among high-skill workers.

Suggested Citation

  • Sarra Ben Yahmed, 2012. "Gender Wage Gaps across Skills and Trade Openness," AMSE Working Papers 1232, Aix-Marseille School of Economics, Marseille, France, revised Nov 2012.
  • Handle: RePEc:aim:wpaimx:1232
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    References listed on IDEAS

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    Cited by:

    1. Bøler, Esther Ann & Javorcik, Beata & Ulltveit-Moe, Karen Helene, 2015. "Globalization: a woman’s best friend? Exporters andthe gender wage gap," LSE Research Online Documents on Economics 62604, London School of Economics and Political Science, LSE Library.
    2. Yahmed, Sarra Ben, 2017. "Gender wage discrimination and trade openness. Prejudiced employers in an open industry," ZEW Discussion Papers 17-047, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    3. Ronald B. Davies & Arman Mazhikeyev, 2015. "The Glass Border: Gender and Exporting in Developing Countries," Working Papers 201525, School of Economics, University College Dublin.

    More about this item

    Keywords

    Gender Wape Gap; Statistical Discrimination; Trade Openess; Technology Upgrading.;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J7 - Labor and Demographic Economics - - Labor Discrimination
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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