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Global Production Sharing and Wage Premiums: Evidence from the Thai Manufacturing Sector

dc.contributor.authorArchanun Kohpaiboon
dc.contributor.authorJuthathip Jongwanich
dc.description.abstractThe paper aims to promote a better understanding of the determinants of wage skill premiums in developing countries, with emphasis on the role of firm heterogeneity as well as global production sharing. An interplant, cross-sectional analysis of the Thai manufacturing sector is undertaken. Our key finding is in line with the theoretical postulation of the established firm heterogeneity literature—i.e., tariff cuts have different effects on firms depending on the mode by which firms are globally integrated.We also find that outsourced economic activities to developing countries are skills intensive. Our finding has implications for the management of economic globalization. First, reluctance to continue trade policy reform could inflate demand for unskilled workers and eventually jeopardize the competitiveness of exporting firms. Second, participation in global production sharing provides not only lucrative business opportunities, but also the chance to move up to a higher rung on the technology ladder. In addition, increasing economic globalization by participating in global production sharing could bring adverse effects to unskilled workers. Social safety net programs must be put in place to mitigate such adverse effects.
dc.publisherAsian Development Bank
dc.rightsCC BY 3.0 IGO
dc.titleGlobal Production Sharing and Wage Premiums: Evidence from the Thai Manufacturing Sector
dc.subject.expertEconomic Crisis
dc.subject.expertEconomic Efficiency
dc.subject.expertEconomic Policies
dc.subject.expertRegional Economic Development
dc.subject.expertPublic Sector Wages
dc.subject.adbEconomic cooperation
dc.subject.adbGross domestic product
dc.subject.adbWage payment systems
dc.subject.naturalFinancial crisis
dc.subject.naturalLabor economics
dc.subject.naturalRegional economics
dc.subject.naturalGuaranteed annual wage
dc.subject.naturalWage differentials
dc.subject.naturalWages and labor productivity
dc.contributor.imprintAsian Development Bank
oar.themePublic Sector
oar.themeLabor Migration
oar.adminregionSoutheast Asia Region
oar.authorKohpaiboon, Archanun
oar.authorJongwanich, Juthathip

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  • Asian Development Review
    The Asian Development Review (ADR) is a professional journal for disseminating the results of economic and development research relevant to Asia and the Pacific. Since 1983, the ADR has been an important part of the history of the Asian Development Bank and its mission to reduce poverty across Asia and the Pacific.

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