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Exporters, Importers and Two-way traders: The links between internationalization, skills and wage

Author

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  • Francesco Serti
  • Chiara Tomasi
  • Antonello Zanfei

Abstract

How do trade activities affect firms' employment and wages structures? Using firm level data on Italian manufacturing firms, this paper adds to the existing literature, by assessing how the degree of involvement in international trade impacts on workforce composition, earning levels and wage inequality. We differentiate firms involved in both trading activities - namely two-way traders - from firms that only export, and from those that only import. We show that two-way traders have a higher propensity to employ non-production workers, exhibit significant wage gaps, but also pay higher wages for both production and non production workers, relative to non international- ized firms and to firms which are involved only in either export or import. The paper also looks at how the wages and the skill structure of the trading firms change with the country of destination and origin and with the firms' sectoral and geographical diversification.

Suggested Citation

  • Francesco Serti & Chiara Tomasi & Antonello Zanfei, 2008. "Exporters, Importers and Two-way traders: The links between internationalization, skills and wage," LEM Papers Series 2008/05, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    • Handle: RePEc:ssa:lemwps:2008/05
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    References listed on IDEAS

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    Cited by:

    1. Stefano Costa & Carmine Pappalardo & Claudio Vicarelli, 2017. "Internationalization choices and Italian firm performance during the crisis," Small Business Economics, Springer, vol. 48(3), pages 753-769, March.
    2. Lejour, Arjan & Rojas Romasgosa, Hugo & Rodriguez, Victor & Montalvo, Carvos & Van der Zee, Frans, 2009. "Trade costs, Openness and Productivity: Market Access at Home and Abroad," MPRA Paper 21214, University Library of Munich, Germany.

    More about this item

    Keywords

    Heterogeneous Firms; Exports; Imports; Wage Inequality; Skills;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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