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Higher Wages in Exporting Firms: Self-Selection, Export Effect, or Both? First Evidence from German Linked Employer-Employee Data

Thorsten Schank (), Claus Schnabel () and Joachim Wagner ()

No 3359, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: While it is a stylized fact that exporting firms pay higher wages than non-exporting firms, the direction of the link between exporting and wages is less clear. Using a rich set of German linked employer-employee panel data we follow over time plants that start to export. We show that the exporter wage premium does already exist in the years before firms start to export, and that it does not increase in the following years. Higher wages in exporting firms are thus due to self-selection of more productive, better paying firms into export markets; they are not caused by export activities.

Keywords: exporter wage premium; wages; exports; Germany (search for similar items in EconPapers)
JEL-codes: F10 D21 J31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec and nep-int
Date: 2008-02
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Published in: Review of World Economics, 2010, 146 (2), 303-322

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Working Paper: Higher Wages in Exporting Firms: Self-selection, Export Effect, or Both? First Evidence from German Linked Employer-Employee Data (2008) Downloads
Working Paper: Higher wages in exporting firms: self-selection, export effect, or both? First evidence from German linked employer-employee data (2008) Downloads
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