The indicators of trade liberalisation used in the study are measures of the

The indicators of trade liberalisation used in the

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The indicators of trade liberalisation used in the study are measures of the degree of import and export penetration, namely the ratios of imports to output and exports to output by industry sector. As in many previous studies, limited data availability means that other measures, such as the effective rate of tariff protection, are not an option. The trade data used are drawn from Malaysia s official external trade database compiled by the Department of Statistics, Malaysia. These data are published at the two-digit Standard International Trade Classification level in, inter alia , the Department of Statistics publication, Malaysia External Trade Statistics . Unpublished data at a more disaggregated level was made available by the Department of Statistics. These data, which are classified according to the three- digit Standard International Trade Classification level, have then been matched to the three-digit Malaysian Industrial Classification, 1972. The latter was the standard classification for industry sectors used in all economic and household censuses and surveys conducted by the Department of Statistics until 2000. Industry output data are compiled from the Department of Statistics Annual Survey of Manufacturing Industries . Table 1. Descriptive statistics 1984 1989 1992 1995 1997 90/10 decile ratio 6.43 6.17 6.00 5.74 5.94 SD (earnings) 8160 8025 8011 8256 7687 90/10 decile ratio trade sector 6.31 5.61 5.01 4.94 5.32 SD (earnings) trade sector 7980 8076 7579 7700 6961 90/10 decile ratio non-trade sector 6.27 6.08 6.36 5.97 6.16 SD (earnings) non-trade sector 8190 7989 8125 8421 7911 Education (% with qualification) Degree 3.2 3.7 3.9 4.1 4.9 Diploma 3.7 4.5 4.6 5.3 6.7 MCE/SPM MCE/SPMV 20.6 24.8 27.5 31.0 31.9 High school cert 1.9 3.1 4.0 4.3 4.0 LCE/SRP/PMR 12.6 10.8 14.3 15.1 14.2 NA-qual 7.5 5.2 5.1 4.4 3.5 No formal qualification 50.5 47.9 40.7 35.8 34.9 Education trade-sector (%) Degree 1.8 1.8 1.7 2.2 2.6 Diploma 0.9 1.2 1.6 2.4 3.6 MCE/SPM MCE/SPMV 18.0 24.5 29.1 32.4 33.4 High school cert 1.2 2.4 3.1 2.9 2.4 LCE/SRP/PMR 13.6 11.4 18.0 17.6 16.2 NA-qual 5.5 4.0 3.5 3.9 3.2 No formal qualification 58.9 54.7 43.0 38.2 38.6 Education non-trade-sector (%) Degree 3.5 4.3 4.7 4.8 5.8 Diploma 4.3 5.5 5.7 6.4 7.8 MCE/SPM MCE/SPMV 21.2 24.8 36.9 30.5 31.3 High school cert 2.0 3.3 4.4 4.8 4.5 LCE/SRP/PMR 12.4 10.6 13.2 14.1 13.5 NA-qual 7.9 5.5 5.7 4.6 3.6 No formal qualification 48.6 46.0 39.8 34.8 33.4 Male (% of total employees) 68.2 66.9 66.2 66.3 64.7 Married (% of total employees) 57.8 60.5 59.1 60.7 61.5 Age (average) 31.4 32.3 32.2 32.7 33.0 Employed in trade sector (% total employees) 19.1 21.9 26.4 27.7 27.0 Trade Openness and Wage Inequality 1123 Downloaded by [Moskow State Univ Bibliote] at 04:44 22 October 2013
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The trade data were also used to define a dichotomous variable to indicate whether an employee is employed in those industry sectors most open to international trade. This follows the approach adopted by Arbache et al. (2004) in which each industry sector is classified to either the trade or non-trade sector depending upon the extent to which it is open to international trade, defined here in terms of the sum of (import penetration + export orientation), a measure used by the Malaysian Ministry of International Trade and Industry. The classification of industry sectors is shown in Table 2. The overall impact of trade liberalisation on employment can be seen in Table 1, which shows that employment in the trade sector increased from 19.1 per cent in 1984 to 27.0 per cent in 1997.
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