Gender Wage Gaps across Skills and Trade Openness

Sarra Ben Yahmed ()

No 1232, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: Several empirical studies have shown that the effect of openness on the gender wage gap depends on the skill requirement of the workplace. This paper offers a theoretical explanation to understand that finding. We integrate a statistical discrimination framework with the labour assignment approach to give general conditions under which the matching between firms and workers gives rise to a wider gender wage gap at the upper tail of the distribution, in accordance with empirical evidence. We further look at the effect of trade openness on the gender wage gap along the entire distribution. Workers’ characteristics vary in two dimensions, skills and job commitment. The inability to observe individual’s job commitment induces employers to base partly their decision on group average. Following the literature on labour and international trade, we assume that skills act as complements to technological upgrading. Exporting firms are more skill-intensive and pay higher wages; assuming further that worker’s job commitment is a complement to technological upgrading, we find that a reduction in trade costs increases wage inequality within-groups and has non-monotonic effects on between-group inequality. Trade openness reduces the gender wage gap among unskilled workers but increases the gender wage gap among high-skill workers.

Keywords: Gender Wape Gap; Statistical Discrimination; Trade Openess; Technology Upgrading. (search for similar items in EconPapers)
JEL-codes: F16 J24 J7 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2012-11, Revised 2012-11
New Economics Papers: this item is included in nep-int, nep-lab and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

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Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:1232

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