Manufacturing Skill-biased Wage Inequality, Natural Resources and Institutions

• Type: Article in International Scientific Journal
• Date: 2017

Authors

Torres, N (Author) Other; Óscar Afonso (Author) FEP; Soares, I (Author) FEP

Journal

Title: Review of Development Economics

Vol. 21

Pages: E1-E29

ISSN: 1363-6669

Publisher: Wiley

Indexing

ISI Web of Knowledge - 0 Citations

ISI Web of Science

Econlit

Scientific classification

CORDIS: Social sciences > Economics

FOS: Social sciences > Economics and Business

Other information

Authenticus ID: P-00N-JER

DOI: 10.1111/rode.12287

Abstract (EN): We use an extensive dataset on occupational wages to measure the manufacturing skill premium and assess, for the first time, the influence of natural resources and institutional quality-in addition to traditional drivers-for advanced and less-advanced countries and the full sample. The new findings, regarding 21 countries between 1988 and 2008 in the main panel estimations, suggest the premium of advanced countries rises with tertiary enrollment, net foreign direct investment (FDI) and institutional quality, and falls with centralized wage negotiations and geographically diffuse natural resource activities, mainly re-exportation related. In less-advanced countries, the premium rises with net FDI, scale effects, centralized wage negotiations and geographically concentrated natural resource activities (absorbing scarce skilled workers), and falls with trade, diffuse natural resource exploration (using mainly unskilled workers) and high-technology exports, as emerging national low-end technology industrial exporters may lower skill pay compared with foreign industrial exporters. In the full sample, the premium rises with scale effects, trade, institutional quality and concentrated natural resources, and falls with the relative skilled-labor supply, centralized wage negotiations and diffuse natural resources. The results account for a wider diversity of situations compared with the previous studies.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 29