Changes in the Thai wage structure before and after the 1997 economic crisis

Abstract

Wage polarisation is observed in Thailand over 1987-2006. I attribute much of the increase in top-end inequality to trend-demand shift favouring college-educated workers resulting from SBTC. The rise in low-end wage rates relative to the median is due to the existence of a large pool of hidden-unemployed labourers in the rural sector. Their migration into low-end city jobs could explain the rising low-end wages. A recent version of the SBTC hypothesis that emphasises the effects of technological advances offers an alternative explanation. There is also evidence that the "massi_cation of higher-education" is a major source of rising top-end residual inequality.