The effect of import penetration on labor market outcomes in Austrian manufacturing industry

Abstract

This paper estimates the effects of imports on employment, wages, and the wage share in Austria for the period of 1990-2005 using panel data of manufacturing industry. Imports are disaggregated according to their origin and as final vs. intermediate imports. There is evidence of significant negative effects of imports on employment, wages and the wage share. Particularly workers in high skilled sectors experience negative effects. Offshoring to both Eastern Europe and the developed countries have a negative impact on employment, whereas offshoring to the East has a positive effect on wages, indicating the dominance of scope effects.

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