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  3. American Economic Review
  4. December 2019
  5. Occupations and Import Competition: Evidence from Denmark

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Occupations and Import Competition: Evidence from Denmark

  • Sharon Traiberman
American Economic Review
vol. 109, no. 12, December 2019
(pp. 4260–4301)
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Abstract

I argue that the winners and losers from trade are decided primarily by occupation. In addition to fixed adjustment costs, workers build up specific human capital over time that is destroyed when they must change occupations. I show that ignoring human capital biases estimates of adjustment costs upward by a factor of 3. Estimating an occupational choice model of the Danish labor market, I show that 57 percent of the dispersion in worker outcomes is accounted for by occupations, and only 16 percent by sectors. Finally, the model suggests that rising import competition from 1995–2005 reduced lifetime earnings for 5 percent of workers.

Citation

Traiberman, Sharon. 2019. "Occupations and Import Competition: Evidence from Denmark." American Economic Review, 109 (12): 4260–4301. DOI: 10.1257/aer.20161925

Additional Materials

JEL Classification

  • F14 Empirical Studies of Trade
  • F16 Trade and Labor Market Interactions
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 Wage Level and Structure; Wage Differentials