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Import Competition and Post-displacement Wages in Korea: Whom You Trade with Matters

Author

Listed:
  • Kang Youngho

    (Department of Economics, Soongsil University, Sangdo-ro 369, Dongjak-gu, Seoul 156-743, South Korea)

  • Im Hyejoon

    (School of Economics and Finance, Yeungnam University, Daehak-ro 280, Kyungsan 712-749, South Korea)

Abstract

Using longitudinal survey data from Korean workers, we examine whether the effects of import competition on post-displacement wages are heterogeneous between skilled and unskilled workers for trading partners with different endowments of (un)skilled labor. Reemployment wages of displaced workers show a decrease for skilled workers but an increase for unskilled ones when imports from an advanced country rise, whereas they decrease for unskilled workers but increase for skilled ones when imports from a developing country rise. The results provide support for the Stolper–Samuelson theorem.

Suggested Citation

  • Kang Youngho & Im Hyejoon, 2016. "Import Competition and Post-displacement Wages in Korea: Whom You Trade with Matters," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(4), pages 1-6, October.
    • Handle: RePEc:bpj:bejeap:v:16:y:2016:i:4:p:6:n:4
    DOI: 10.1515/bejeap-2016-0112
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    More about this item

    Keywords

    import competition; post-displacement wages; skilled and unskilled labor; Stolper–Samuelson theorem; Korea;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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