Trade openness and wage distribution in Chile
This article analyses the effect of trade openness, implemented in Chile after 1974, on wage inequality. In the first part, this study analyses inequality and wage distribution in Chile. Workers are grouped in three categories, according to the educational level reached, in order to discriminate between skilled and unskilled labor and calculate the wage gap. The wage gap between workers with a university degree and laborers that completed the secondary school increased during the period analyzed. The wage gap between workers with secondary education completed and laborers that completed the first cycle of education decreased in the period. The second part of this article investigates the relationship between wage inequality dynamics of different groups of workers and trade openness. The empirical results suggest that trade liberalization increased wage differences between workers with a university degree and workers with a high school degree, while it did not affect the decreasing wage gap between laborers with secondary school completed and laborers with primary school completed. This paper is made up of six sections. Section I introduces the analysis. Section II describes briefly the trade liberalization process. Section III analyses the wage distribution in Chile and a measure of the wage gap between more educated and less educated workers is obtained. Section IV presents some theoretical aspects. Section V analyses the effects of the trade liberalization on the wage gap, considering different groups of workers, according to the educational level. Section VI concludes.
|Date of creation:||Sep 2005|
|Date of revision:||Sep 2005|
|Contact details of provider:|| Postal: |
Web page: http://www.kites.unibocconi.it/
|Order Information:|| Postal: E G E A - via R. Sarfatti, 25 - 20136 Milano -Italy|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Wood, Adrian, 1997. "Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom," World Bank Economic Review, World Bank Group, vol. 11(1), pages 33-57, January.
- Adrian Wood, 1995. "How Trade Hurt Unskilled Workers," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 57-80, Summer.
- Pavcnik, Nina, 2003.
"What explains skill upgrading in less developed countries?,"
Journal of Development Economics,
Elsevier, vol. 71(2), pages 311-328, August.
- Nina Pavcnik, 2000. "What Explains Skill Upgrading in Less Developed Countries?," NBER Working Papers 7846, National Bureau of Economic Research, Inc.
- Orazio Attanasio & Pinelopi Goldberg & Nina Pavcnik, 2003.
"Trade Reforms and Wage Inequiality in Colombia,"
NBER Working Papers
9830, National Bureau of Economic Research, Inc.
- Daron Acemoglu, 2002.
"Technical Change, Inequality, and the Labor Market,"
Journal of Economic Literature,
American Economic Association, vol. 40(1), pages 7-72, March.
- Daron Acemoglu, 2000. "Technical Change, Inequality, and the Labor Market," NBER Working Papers 7800, National Bureau of Economic Research, Inc.
- Wood Júnior, Thomaz, 1995. "Workers," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 35(2), January.
- Jones, Ronald W & Engerman, Stanley L, 1996. "Trade, Technology, and Wages: A Tale of Two Countries," American Economic Review, American Economic Association, vol. 86(2), pages 35-40, May.
- Beyer, Harald & Rojas, Patricio & Vergara, Rodrigo, 1999. "Trade liberalization and wage inequality," Journal of Development Economics, Elsevier, vol. 59(1), pages 103-123, June.
When requesting a correction, please mention this item's handle: RePEc:cri:cespri:wp173. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Valerio Sterzi)
If references are entirely missing, you can add them using this form.