The purpose of this paper is to investigate the effects of Chinese and non-Chinese import penetration on the inter-industry wage premium, and how such effects vary according to the unskilled-labor intensity of the industry and to the implementation of the Nova Matriz Economica policy in 2008.
The paper empirically examines the effects of the Chinese and non-Chinese import penetration on the wage premium using a linear instrumental variables model and data from Brazilian household surveys and censuses.
The estimates show the Chinese import penetration positively affecting the wage premium in unskilled-labor intensive. And the implementation of the new macroeconomic policy strengthened this effect.
To the best of the author’s knowledge, this is the first paper to study the effects of Chinese and non-Chinese import penetration on the inter-industry wage premium.
