Adjusting to Globalization in Germany

Wolfgang Dauth, Sebastian Findeisen and Jens Suedekum

Journal of Labor Economics, 2021, vol. 39, issue 1, 263 - 302

Abstract: We study the impact of trade exposure on the job biographies of 2.4 million manufacturing workers in Germany. Rising export opportunities lead to two equally important sources of earnings gains: on the job and employer switches within the same industry. Highly skilled workers benefit the most. Import shocks mostly hurt low-skilled workers, especially when they possess lots of industry-specific human capital. They also destroy workers’ rents when separating from high-wage plants, and they leave strongly scarring effects in the event of a mass layoff. We connect our results to the growing theoretical literature on the labor market effects of trade.

Date: 2021
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Related works:
Working Paper: Adjusting to Globalization in Germany (2019)
Working Paper: Adjusting to Globalization in Germany (2018)
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