Capital Accumulation, Trade Liberalization, and Rising Wage Inequality: The Case of Argentina.

The article presents a study that assesses the effect of capital accumulation on the observed wage gap between skilled and unskilled workers in the manufacturing sector in Argentina. It provides evidence of the relationship between capital accumulation and the wage structure through the variability in wage premia and capital investment across industries in Argentina's manufacturing sector. The authors used repeated cross-sectional data from the Permanent Household Survey between 1991 and 2001, as well as official data on import penetration, exports and investment in machinery and equipment manufacturing sector. Results of the study reveals that in sectors in which capital accumulation has been more intense, the wage gap between skilled and unskilled workers has significantly widened.