Adjusting to Globalization in Germany

44 Pages Posted: 6 Feb 2018

See all articles by Wolfgang Dauth

Wolfgang Dauth

Institute for Employment Research (IAB)

Sebastian Findeisen

University of Zurich; IZA Institute of Labor Economics

Jens Suedekum

Heinrich-Heine-University Duesseldorf, Duesseldorf Institute for Competition Economics (DICE); Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Institute for the Study of Labor (IZA)

Abstract

We exploit rich worker-establishment data to trace the impact of rising international trade exposure in the job biographies of roughly 2.4 million manufacturing workers in Germany (1990–2010). To profit from export opportunities, workers respond by increased employer switching within industries. Highly skilled workers benefit the most from increased export exposure, consistent with an increase in skill demand. The incidence of import shocks falls mostly on low-skilled workers, as they are not able to adjust as well as medium- and high-skilled workers. Imports also destroy rents by workers at high-wage plants who separate from their original firm. We connect our results to the growing theoretical literature on the labor market effects of trade.

Keywords: international trade, individual labor market responses, work biographies, worker mobility, Germany

JEL Classification: F16, J31, R11

Suggested Citation

Dauth, Wolfgang and Findeisen, Sebastian and Südekum, Jens, Adjusting to Globalization in Germany. IZA Discussion Paper No. 11299. Available at SSRN: https://ssrn.com/abstract=3117303

Wolfgang Dauth (Contact Author)

Institute for Employment Research (IAB) ( email )

Regensburger Str. 104
Nuremberg, 90478
Germany

HOME PAGE: http://www.iab.de/en/ueberblick/mitarbeiter.aspx/Mitarbeiter/603

Sebastian Findeisen

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Jens Südekum

Heinrich-Heine-University Duesseldorf, Duesseldorf Institute for Competition Economics (DICE) ( email )

Universitaetsstr. 1
Duesseldorf, NRW 40225
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

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