Chinese Penetration and Importer Country Wages: Microevidence From Chile

Roberto Alvarez and Luis Opazo

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: The increasing importance of China in the world trade raises important questions on its impact on importing countries. This paper studies how import competition from China has affected wages in the Chilean Manufacturing Industry. Using plant-level data for the period 1996-2005, we find that increasing imports from China have tended to depress real wages in manufacturing plants. This negative effect on manufacturing workers is heterogeneous. We find that firms in labor-intensive industries and smaller firms have been quantitatively more affected by Chinese competition. These results hold to correction for sample selection and alternative measures of import competition from low-wages countries.

Date: 2008-06
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Persistent link: https://EconPapers.repec.org/RePEc:chb:bcchwp:473

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