abstract: 'We investigate the effects of the drastic tariff reductions of the 1980s

  and 1990s in Colombia on the wage distribution. We identify three main

  channels through which the wage distribution was affected: increasing

  returns to college education, changes in industry wages that hurt

  sectors with initially lower wages and a higher fraction of unskilled

  workers, and shifts of the labor force towards the informal sector that

  typically pays lower wages and offers no benefits. Our results suggest

  that trade policy played a role in each of the above cases. The increase

  in the skill premium was primarily driven by skilled-biased

  technological change; however, our evidence suggests that this change

  may have been in part motivated by the tariff reductions and the

  increased foreign competition to which the trade reform exposed domestic

  producers. With respect to industry wages, we find that wage premiums

  decreased by more in sectors that experienced larger tariff cuts.

  Finally, we find some evidence that the increase in the size of the

  informal sector is related to increased foreign competition-sectors with

  larger tariff cuts and more trade exposure, as measured by the size of

  their imports, experience a greater increase in informality, though this

  effect is concentrated in the years prior to the labor market reform.

  Nevertheless, increasing returns to education, and changes in industry

  premiums and informality alone cannot fully explain the increase in wage

  inequality we observe over this period. This suggests that overall the

  effect of the trade reforms on the wage distribution may have been

  small. (C) 2004 Elsevier B.V. All rights reserved.'
affiliation: 'Attanasio, O (Corresponding Author), UCL, Dept Econ, Torrington Pl,Gower
  St,Rm 222,Drayton House, London WC1E 6BT, England.

  UCL, Dept Econ, London WC1E 6BT, England.

  Inst Fiscal Studies, London WC1E 6BT, England.

  Dartmouth Coll, Dept Econ, Hanover, NH 03755 USA.'
author: Attanasio, O and Goldberg, PK and Pavcnik, N
author-email: 'o.Attanasio@ucl.ac.uk

  Penny.Goldberg@yale.edu

  Nina.Pavcnik@Dartmouth.edu'
author_list:
- family: Attanasio
  given: O
- family: Goldberg
  given: PK
- family: Pavcnik
  given: N
da: '2023-09-28'
doi: 10.1016/j.jdeveco.2003.07.001
eissn: 1872-6089
files: []
issn: 0304-3878
journal: JOURNAL OF DEVELOPMENT ECONOMICS
keywords: trade reforms; wage inequality; Colombia
keywords-plus: 'PRODUCTIVITY GROWTH; LIBERALIZATION; IMPACT; COMPETITION; PROTECTION;

  MEXICO; LABOR; EMPLOYMENT; COSTS'
language: English
month: AUG
number: '2'
number-of-cited-references: '48'
pages: 331-366
papis_id: 73f14d7731b015d2a437435dba639546
ref: Attanasio2004tradereforms
times-cited: '205'
title: Trade reforms and wage inequality in Colombia
type: article
unique-id: WOS:000222045700003
usage-count-last-180-days: '3'
usage-count-since-2013: '47'
volume: '74'
web-of-science-categories: Economics
year: '2004'