Exporters, skill upgrading, and the wage gap

56 Pages·1994·1.2 MB·English

by  Bernard, Andrew B., 1963-

'
M.I.T. LfBRARFES - DEWEY
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working paper
department
of economics
EXPORTERS, SKILL UPGRADING, AND THE WAGE GAP
Andrew B. Bernard
J. Bradford Jensen
94-30 Sept. 1994
massachusetts
institute of
technology
50 memorial drive
Cambridge, mass. 02139

EXPORTERS, SKILL UPGRADING, AND THE WAGE GAP
Andrew B. Bernard
J. Bradford Jensen
94-30 Sept. 1994
_,,,iSETTSINSTITUTE
OCT 2 1 1994
Exporters, Skill Upgrading, and the Wage Gap*
Andrew B. Bernard J. Bradford Jensen*
Department of Economics Center for Economic Studies
MJ.T. Bureau of the Census
Cambridge, MA 02139 Washington, DC 20233
September, 1994
"We thank Lael Brainaid, Roland Benabou, Mark Doms, Jon Gruber, Ron Jaimin, Michael Kremei,
Lorenza Martinez, Robert McGuckin, and Ken Troskefor helpful discussions as well as seminar partici-
pants at the Bureau ofthe Census, Johns Hopkins University, the NBER Summer Institute, the Winter
Meetings of the Econometric Society, and MIT. Additionally we thank Bob Taylor for assistance with
the data and Emily Gallagher for table preparation. Bernard's research was supported by the World
Economy Laboratory at MIT. All errors are ours.
'Opinions expressed in this paper are those of the authors and do not necessarily reflect official
positions of the Bureau of the Census.
Abstract
This paper examines plant level evidence on the increase in demand for non-
production workers in U.S. manufacturing during the 1980's. The major finding is
that increases in employment at exporting plants contribute heavily to the observed
increase in relative demand for skilled labor in manufacturing during the period.
Exporters account for almost all of the increase in the wage gap between high and
low-skilled workers. Testsofthe competing theories with plant level datashow that
demand changes associated with increased exports are strongly associated with the
wage gap increases^Increases in plant technology are determinants ofwithin plant
skill-upgrading but not of the aggregate wage gap rise.
JEL Classification: F10, J21, E24