Working Paper: NBER ID: w15107
Authors: Avraham Ebenstein; Ann Harrison; Margaret McMillan; Shannon Phillips
Abstract: We link industry-level data on trade and offshoring with individual-level worker data from the Current Population Surveys from 1984 to 2002. We find that occupational exposure to globalization is associated with significant wage effects, while industry exposure has no significant impact. We present evidence that globalization has put downward pressure on worker wages through the reallocation of workers away from higher wage manufacturing jobs into other sectors and other occupations. Using a panel of workers, we find that occupation switching due to trade led to real wage losses of 12 to 17 percentage points.
Keywords: Trade; Offshoring; Wages; Globalization
JEL Codes: F15; F16; F23; J23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Occupational exposure to import competition (F66) | decline in real wages for workers in routine occupations (F66) |
| Increase in occupational exposure to import competition (F66) | decline in real wages for workers in routine occupations (F66) |
| Occupation-specific exposure to overseas employment in low-wage countries (F66) | decline in real wages for routine task workers (F66) |
| Occupation-specific exposure to overseas employment in low-wage countries (F66) | decline in real wages for routine task workers (1997-2002) (F66) |
| Increase in export share at the occupation level (F14) | increase in wages (J38) |
| Occupation switching due to trade (F16) | real wage losses (J39) |
| Reallocation of workers from higher-paid manufacturing jobs to lower-paid sectors (J68) | downward pressure on wages (F66) |