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Skills, Exports, and the Wages of Seven Million Latin American Workers

Author

Listed:
  • Irene Brambilla
  • Rafael Dix-Carneiro
  • Daniel Lederman
  • Guido Porto
Abstract
The returns to schooling and the skill premium are key parameters in various fields and policy debates, including the literatures on globalization and inequality, international migration, and technological change. This paper explores the skill premium and its correlation with exports in Latin America, thus linking the skill premium to the emerging literature on the structure of trade and development. Using data on employment and wages for over seven million workers from sixteen Latin American economies, the authors estimate national and industry-specific returns to schooling and skill premiums and study some of their determinants. The evidence suggests that both country and industry characteristics are important in explaining returns to schooling and skill premiums. The analyses also suggest that the incidence of exports within industries, the average income per capita within countries, and the relative abundance of skilled workers are related to the underlying industry and country characteristics that explain these parameters. In particular, sectoral exports are positively correlated with the skill premium at the industry level, a result that supports recent trade models linking exports with wages and the demand for skills. Copyright 2012, Oxford University Press.

Suggested Citation

  • Irene Brambilla & Rafael Dix-Carneiro & Daniel Lederman & Guido Porto, 2012. "Skills, Exports, and the Wages of Seven Million Latin American Workers," The World Bank Economic Review, World Bank, vol. 26(1), pages 34-60.
    • Handle: RePEc:oup:wbecrv:v:26:y:2012:i:1:p:34-60
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    Cited by:

    1. Oostendorp, Remco H. & Doan, Quang Hong, 2013. "Have the returns to education really increased in Vietnam? Wage versus employment effect," Journal of Comparative Economics, Elsevier, vol. 41(3), pages 923-938.
    2. Yoshimichi Murakami, 2021. "Trade liberalization and wage inequality: Evidence from Chile," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 30(3), pages 407-438, April.
    3. Sarra Ben Yahmed, 2012. "Gender Wage Gaps across Skills and Trade Openness," Working Papers halshs-00793559, HAL.
    4. Sampson, Thomas, 2016. "Assignment reversals: Trade, skill allocation and wage inequality," Journal of Economic Theory, Elsevier, vol. 163(C), pages 365-409.
    5. Giuseppe Celi, 2021. "The Labour Market Effects of International Trade in the Presence of Vertical Product Differentiation: Some Methodological Remarks in Retrospect," JRFM, MDPI, vol. 14(3), pages 1-26, March.
    6. Ben Yahmed, Sarra, 2023. "Gender wage discrimination with employer prejudice and trade openness," World Development, Elsevier, vol. 170(C).
    7. Jorge Friedman & Nanno Mulder & Sebastián Faúndez & Esteban Pérez Caldentey & Carlos Yévenes & Mario Velásquez & Fernando Baizán & Gerhard Reinecke, 2011. "Openness, Wage Gaps and Unions in Chile: A Micro Econometric Analysis," OECD Trade Policy Papers 134, OECD Publishing.
    8. Porto, Guido, 2012. "The cost of adjustment to green growth policies : lessons from trade adjustment costs," Policy Research Working Paper Series 6237, The World Bank.
    9. Liu, Rebecca & Rammer, Christian, 2016. "The contribution of different public innovation funding programs to SMEs' export performance," ZEW Discussion Papers 16-078, ZEW - Leibniz Centre for European Economic Research.
    10. D. Lederman & W.F. Maloney & J. Messina, 2011. "The Fall of Wage Flexibility," World Bank Publications - Reports 23575, The World Bank Group.
    11. Lederman, Daniel, 2011. "International trade and inclusive growth : a primer for busy policy analysts," Policy Research Working Paper Series 5886, The World Bank.
    12. Gasparini, Leonardo & Galiani, Sebastian & Cruces, Guillermo & Acosta, Pablo A., 2011. "Educational Upgrading and Returns to Skills in Latin America: Evidence from a Supply-Demand Framework, 1990-2010," IZA Discussion Papers 6244, Institute of Labor Economics (IZA).
    13. Manuel Fernández & Gabriela Serrano, 2022. "New Perspectives on Inequality in Latin America," Documentos CEDE 20295, Universidad de los Andes, Facultad de Economía, CEDE.
    14. Sarra Ben Yahmed, 2012. "Gender Wage Gaps across Skills and Trade Openness," AMSE Working Papers 1232, Aix-Marseille School of Economics, France, revised Nov 2012.

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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