A Reexamination of the Time Path of Wage Differentials in Taiwan

14 Pages Posted: 1 Jun 2004

See all articles by Chung-Hung A. Lin

Chung-Hung A. Lin

Tamkang University - Department of Industrial Economics

Peter F. Orazem

Iowa State University and IZA; IZA Institute of Labor Economics

Abstract

Contrary to the conclusions of a recent paper by Chen and Hsu (Review of Development Economics, vol. 5, 2001, pp. 336-54), wage inequality and returns to college-educated workers have risen in Taiwan since 1980. Government policies, which have caused rapid expansion of the supply of new college graduates, have depressed returns for only the youngest cohorts of college graduates. Older cohorts of college graduates experienced rising returns, as have college graduates as a whole. Young college-educated women's returns fell more and older college-educated women's returns rose more relative to their male counterparts. Consequently, the rising share of women in the labor force helped amplify these trends. Changing trade patterns have tended to increase labor demand in sectors that use educated labor more intensively, helping to raise returns to skill. However, in contrast to western economies, rising capital intensity does not appear to have accelerated the pay gap by skill in Taiwan.

Suggested Citation

Lin, Chung-Hung A. and Orazem, Peter Francis, A Reexamination of the Time Path of Wage Differentials in Taiwan. Review of Development Economics, Vol. 8, No. 2, pp. 295-308, May 2004. Available at SSRN: https://ssrn.com/abstract=531760

Chung-Hung A. Lin (Contact Author)

Tamkang University - Department of Industrial Economics ( email )

151 Ying Chuan Road
Tamsui
New Taipei City, 251
Taiwan

Peter Francis Orazem

Iowa State University and IZA ( email )

260 Heady Hall
Ames, IA 50011
United States
515-294-8656/515-294-7740 (Phone)
515-294-0221 (Fax)

IZA Institute of Labor Economics

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

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