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Skill Premiums of Trading in International Markets and Equity: Some Lessons for Pro Poor Education Policies in Developing Countries

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  • Mamoon, Dawood

Abstract

The aim of this paper is to examine whether the human capital accumulation, that is a result of increased trade, further exacerbates industrial wage differentials. We find that level of education is one of the key determinants in explaining wage inequalities. Though countries which have a higher level of human capital do well on the inequality front, our results suggest that post liberalization human capital accumulation is associated with higher premiums to skilled labor thus increasing wage gaps. In this context, governments in developing countries may need to increase the mean level of human capital to achieve equity in labor markets.

Suggested Citation

  • Mamoon, Dawood, 2007. "Skill Premiums of Trading in International Markets and Equity: Some Lessons for Pro Poor Education Policies in Developing Countries," MPRA Paper 4319, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:4319
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    More about this item

    Keywords

    Integration; Trade Liberalization; Wage Inequality;
    All these keywords.

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • I20 - Health, Education, and Welfare - - Education - - - General
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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