The Impact of Foreign Trade on the Gender Wage Gap Based on Fixed Effects Model and Propensity Score Matching Method

Abstract

Based on the China Industry Business Performance Database from 2004 to 2007, this paper adopts a linear regression model to measure the gender wage gap at the enterprise level and constructs a fixed-effects model to analyze the impact of foreign trade on the gender wage gap in China's electronic equipment manufacturing industry. The results show that foreign trade will help to narrow the gender wage gap between labor forces. The results are still valid after the robustness tests such as the replacement index, the reduction of sample size and the replacement model as PSM. The heterogeneity analysis shows that foreign trade has a significant negative effect on the gender wage gap of enterprises in the eastern region of China in terms of different regions of China. From the perspective of enterprise size, foreign trade has a significant negative impact on the gender wage gap of medium-sized enterprises. This paper proposes to actively integrate into the international division of labor by increasing trade openness.