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Education, Development, and Wage Inequality: The Case of Taiwan

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  • Vere, James P

Abstract

This article uses a multiple-stage Theil decomposition to examine the contribution of five development processes to wage inequality in Taiwan: increases in educational attainment, the expansion of skill-intensive industries, factor-specific technical change, population aging, and the entry of women into the labor force. Since the supply of skill tends to remain constant within cohorts, the Theil decomposition is useful in separating the effects of supply- and demand-related factors on the wage structure. Increases in educational attainment tended to reduce inequality in the 1980s, but factor-specific technical change increased inequality in the 1990s.

Suggested Citation

  • Vere, James P, 2005. "Education, Development, and Wage Inequality: The Case of Taiwan," Economic Development and Cultural Change, University of Chicago Press, vol. 53(3), pages 711-735, April.
    • Handle: RePEc:ucp:ecdecc:y:2005:v:53:i:3:p:711-35
    DOI: 10.1086/427245
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    References listed on IDEAS

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    1. Juhn, Chinhui & Kim, Dae Il, 1999. "The Effects of Rising Female Labor Supply on Male Wages," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 23-48, January.
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    3. Zachary Zimmer & Xian Liu & Albert Hermalin & Yi-Li Chuang, 1998. "Educational attainment and transitions in functional status among older Taiwanese," Demography, Springer;Population Association of America (PAA), vol. 35(3), pages 361-375, August.
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    6. Gindling, T. H. & Goldfarb, Marsha & Chang, Chun-Chig, 1995. "Changing returns to education in Taiwan: 1978-1991," World Development, Elsevier, vol. 23(2), pages 343-356, February.
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    Cited by:

    1. Wang, Wei-Ching, 2009. "Information economy and inequality: Wage polarization, unemployment, and occupation transition in Taiwan since 1980," Journal of Asian Economics, Elsevier, vol. 20(2), pages 120-136, March.
    2. Judith Liu & Mei‐Ying Lai & Zong‐Shin Liu, 2022. "Trade liberalization, domestic reforms, and income inequality: Evidence from Taiwan," Review of Development Economics, Wiley Blackwell, vol. 26(3), pages 1286-1309, August.
    3. Patricia Cortés & Jessica Pan, 2013. "Outsourcing Household Production: Foreign Domestic Workers and Native Labor Supply in Hong Kong," Journal of Labor Economics, University of Chicago Press, vol. 31(2), pages 327-371.
    4. Shao-Hsun Keng & Chun-Hung Lin & Peter F. Orazem, 2017. "Expanding College Access in Taiwan, 1978-2014: Effects on Graduate Quality and Income Inequality," Journal of Human Capital, University of Chicago Press, vol. 11(1), pages 1-34.
    5. Tsai, Wehn-Jyuan & Liu, Jin-Tan & Chou, Shin-Yi & Thornton, Robert, 2009. "Does educational expansion encourage female workforce participation? A study of the 1968 reform in Taiwan," Economics of Education Review, Elsevier, vol. 28(6), pages 750-758, December.

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