Kandilov, Ivan T.2012-03-302012-03-302009-06-30World Bank Economic Review1564-698Xhttps://hdl.handle.net/10986/4503The impact of increased export activity on plant wages is estimated in a developing country context. To avoid potential endogenous selection problems, the empirical analysis benefits from exogenous variation in exports induced by a policy experiment—an export subsidy system implemented in Chile in 1986. Analyses using data from a panel survey of Chilean manufacturing establishments show that while the export subsidy had only a modest positive impact on the industrywide relative high-skilled wage, it significantly increased the plant-level relative high-skilled wage in medium-size establishments, which are most likely to take advantage of the subsidy and enter the export market.CC BY-NC-ND 3.0 IGObook valueconsumersdevaluationeconometric modelseconomicselasticityexportexport subsidyexportsfree tradeGDPgrowth rateinternational tradeinventoryrentssunk coststrade liberalizationvalue addedwage differentialswagesJournal ArticleWorld Bank10.1596/4503