TY  - JOUR
AU  - Amiti,Mary
AU  - Davis,Donald R.
TI  - Trade, Firms, and Wages: Theory and Evidence
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14106
PY  - 2008
Y2  - June 2008
UR  - http://www.nber.org/papers/w14106
L1  - http://www.nber.org/papers/w14106.pdf
N1  - Author contact info:
Mary Amiti
International Research
Federal Reserve Bank of New York
33 Liberty St
New York, NY 10045-0001
E-Mail: Mary.Amiti@ny.frb.org

Donald R. Davis
Columbia University, Department of Economics
1038 Intl. Affairs Building
420 West 118th St.
New York, NY 10027
Tel: 212/854-4037
Fax: 212/854-8059
E-Mail: drd28@columbia.edu
AB  - How does trade liberalization affect wages? This is the first paper to consider in theory and data how the impact of final and intermediate input tariff cuts on workers' wages varies with the global engagement of their firm. Our model predicts that a fall in output tariffs lowers wages at import-competing firms, but boosts wages at exporting firms.  Similarly, a fall in input tariffs raises wages at import-using firms relative to those at firms that only source locally. Using highly detailed Indonesian manufacturing census data for the period 1991 to 2000, we find considerable support for the model's predictions.
ER  -