The effect of outward processing trade on wage inequality : the Hong Kong case

Research output: Journal PublicationsJournal Article (refereed)Researchpeer-review

5 Citations (Scopus)

Abstract

This study uses time series analysis to investigate the impact of Hong Kong's increased outward processing trade with the Chinese Mainland on wage inequality. We found a significant positive association between outward processing trade and the wage premium of university graduates over primary school graduates and that over secondary school graduates. Moreover, a standard test showed one-way causality from outward processing trade to the widening of skill wage gap. Furthermore, the increase of outward processing trade is found to both increase the pay for well-educated people and decrease the pay for less well-educated people, thereby widening the wage gap.
Original languageEnglish
Pages (from-to)241-257
Number of pages17
JournalJournal of International Economics
Volume67
Issue number1
DOIs
Publication statusPublished - 1 Sep 2005

Fingerprint

Hong Kong
Processing trade
Wage inequality
Wage gap
Time series analysis
Wages
Causality
Premium
Primary school
Secondary school

Keywords

  • Causality
  • Outward processing trade
  • Wage inequality

Cite this

@article{0f0a95598db042609f00c4e2f85c3e53,
title = "The effect of outward processing trade on wage inequality : the Hong Kong case",
abstract = "This study uses time series analysis to investigate the impact of Hong Kong's increased outward processing trade with the Chinese Mainland on wage inequality. We found a significant positive association between outward processing trade and the wage premium of university graduates over primary school graduates and that over secondary school graduates. Moreover, a standard test showed one-way causality from outward processing trade to the widening of skill wage gap. Furthermore, the increase of outward processing trade is found to both increase the pay for well-educated people and decrease the pay for less well-educated people, thereby widening the wage gap.",
keywords = "Causality, Outward processing trade, Wage inequality",
author = "HO, {Lok Sang} and Xiangdong WEI and WONG, {Wai Chung, Gary}",
year = "2005",
month = "9",
day = "1",
doi = "10.1016/j.jinteco.2004.09.005",
language = "English",
volume = "67",
pages = "241--257",
journal = "Journal of International Economics",
issn = "0022-1996",
publisher = "Elsevier",
number = "1",

}

The effect of outward processing trade on wage inequality : the Hong Kong case. / HO, Lok Sang; WEI, Xiangdong; WONG, Wai Chung, Gary.

In: Journal of International Economics, Vol. 67, No. 1, 01.09.2005, p. 241-257.

Research output: Journal PublicationsJournal Article (refereed)Researchpeer-review

TY - JOUR

T1 - The effect of outward processing trade on wage inequality : the Hong Kong case

AU - HO, Lok Sang

AU - WEI, Xiangdong

AU - WONG, Wai Chung, Gary

PY - 2005/9/1

Y1 - 2005/9/1

N2 - This study uses time series analysis to investigate the impact of Hong Kong's increased outward processing trade with the Chinese Mainland on wage inequality. We found a significant positive association between outward processing trade and the wage premium of university graduates over primary school graduates and that over secondary school graduates. Moreover, a standard test showed one-way causality from outward processing trade to the widening of skill wage gap. Furthermore, the increase of outward processing trade is found to both increase the pay for well-educated people and decrease the pay for less well-educated people, thereby widening the wage gap.

AB - This study uses time series analysis to investigate the impact of Hong Kong's increased outward processing trade with the Chinese Mainland on wage inequality. We found a significant positive association between outward processing trade and the wage premium of university graduates over primary school graduates and that over secondary school graduates. Moreover, a standard test showed one-way causality from outward processing trade to the widening of skill wage gap. Furthermore, the increase of outward processing trade is found to both increase the pay for well-educated people and decrease the pay for less well-educated people, thereby widening the wage gap.

KW - Causality

KW - Outward processing trade

KW - Wage inequality

UR - http://www.ln.edu.hk/econ/staff/xdwei/docs/hkecon/HKtradeandwage2006.pdf

UR - http://commons.ln.edu.hk/sw_master/376

U2 - 10.1016/j.jinteco.2004.09.005

DO - 10.1016/j.jinteco.2004.09.005

M3 - Journal Article (refereed)

VL - 67

SP - 241

EP - 257

JO - Journal of International Economics

JF - Journal of International Economics

SN - 0022-1996

IS - 1

ER -