Working Paper: NBER ID: w24424
Authors: Shushanik Hakobyan; John McLaren
Abstract: Using US Census data for 1990-2000, we estimate effects of NAFTA on US wages, focusing on differences by gender. We find that NAFTA tariff reductions are associated with substantially reduced wage growth for married blue-collar women, much larger than the effect for other demographic groups. We investigate several possible explanations for this finding. It is not explained by differential sensitivity of female-dominated occupations to trade shocks, or by household bargaining that makes married women workers less able to change their industry of employment than other workers. We find some support for an explanation based on an equilibrium theory of selective non-participation in the labor market, whereby some of the higher-wage married women workers in their industry drop out of the labor market in response to their industry's loss of tariff. However, this does not fully explain the findings so we are left with a puzzle.
Keywords: NAFTA; wages; married women; gender inequality; trade shocks
JEL Codes: F13; F16; J31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| NAFTA tariff reductions (F15) | wage growth for married blue-collar women (J31) |
| NAFTA tariff reductions (F15) | selective non-participation in labor market (J22) |
| selective non-participation in labor market (J22) | wage growth for married blue-collar women (J31) |