Workers beneath the Floodgates: Low-Wage Import Competition and Workers' Adjustment

• 成果类型: Article
• 署名作者: Utar, Hale
• 署名单位: University of Bielefeld; Leibniz Association; Ifo Institut
• 刊物名称: REVIEW OF ECONOMICS AND STATISTICS
• ISSN/ISSBN: 0034-6535
• DOI: 10.1162/rest_a_00727
• 发表日期: 2018-07
• 页码: 631-647
• 关键词: trade liberalization; displaced workers; skill acquisition; TECHNOLOGY; countries; specificity; DYNAMICS; IMPACT

摘要

Using employee-employer matched data, I analyze the impact of a low-wage trade shock on manufacturing workers in a high-wage country, Denmark, and how they adjust to the shock over a decade. I derive causal effects by exploiting the dismantling of the Multifiber Arrangement quotas on products from China upon its WTO accession as a quasi-natural experiment and use within-industry, within-occupation heterogeneity in workers' exposure to this shock. I find significant negative long-run effects on earnings and employment trajectories and identify job instability in the service sector as a main adjustment friction, concentrated among workers with manufacturing-specific education and occupation. The results establish the importance of specific human capital in trade adjustment and provide evidence of skill upgrading as workers rebuild lost human capital through education.