IDEAS home Printed from https://ideas.repec.org/p/eab/laborw/22043.html
   My bibliography  Save this paper

Understanding Wage Inequality - Trade, Technology, and Location

Author

Listed:
  • Chul Chung

    (Korea Institute for International Economic Policy)

  • Bonggeun Kim

Abstract

This paper investigates the trend of the wage inequality and the metropolitan wage premium in the United States during the 1980s. Two distinct sets of literature documented that the wage inequality between skilled and unskilled workers and the metropolitan wage premium have risen significantly during the decade. When we combine these two sets of evidence and consider the interaction between skill and location, however, the increasing trends of the skill wage gap and the metropolitan wage premium almost disappear. Most of the dynamic changes are picked up by the interaction term, an extra metropolitan wage premium for skill, which rises significantly over the decade. As a partial explanation we find an increasing trend of the skill wage inequality across industries and occupations within metropolitan areas relative to non-metropolitan areas. This finding suggests that the skill biased technology alone may not sufficiently explain the growing wage inequality and it can be interpreted as a metropolitan specific phenomenon to an extent.

Suggested Citation

  • Chul Chung & Bonggeun Kim, 2007. "Understanding Wage Inequality - Trade, Technology, and Location," Labor Economics Working Papers 22043, East Asian Bureau of Economic Research.
  • Handle: RePEc:eab:laborw:22043
    as

    Download full text from publisher

    File URL: http://www.eaber.org/node/22043
    Download Restriction: no

    References listed on IDEAS

    as
    1. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," Review of Economic Studies, Oxford University Press, vol. 9(1), pages 58-73.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Anwar, Sajid & Sun, Sizhong, 2012. "Trade liberalisation, market competition and wage inequality in China's manufacturing sector," Economic Modelling, Elsevier, vol. 29(4), pages 1268-1277.

    More about this item

    Keywords

    Wage inequality; Skill premium; Metropolitan areas; globalization;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eab:laborw:22043. 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: (Shiro Armstrong). General contact details of provider: http://edirc.repec.org/data/eaberau.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.