Exporters and wage inequality during the Great Recession—Evidence from Germany

• We examine the exporter wage premium (EWP) during the financial crisis.
• It decreased at the dawn of the crisis and stagnated afterwards.
• It explains 24%–43% of the decrease in residual wage inequality between 2007 and 2008.
• This happened because exporters adjusted wages earlier than non-exporters.

We show that the exporter wage premium decreased at the dawn of the Great Recession and stagnated afterwards. Our decomposition suggests that the decline of the premium explains 24%–43% of the decrease in residual wage inequality between 2007 and 2008.