Abstract On the basis of determining the wage inequality phenomenon, this paper establishes the study framework among industry agglomeration, bias of spillover and wage inequality from the perspective of industry cluster. By using industry panel data from 2001 to 2011 and applying the simultaneous equation estimate method, this paper finds that among three indexes of industry agglomeration, only inter-industry agglomeration degree influence biased spillover most directly and most significantly. In addition, biased spillover is also affected by the ownership and the degree of openness. The results further show that, industry agglomeration also has an impact on wage inequality. The promotion of intra-industry agglomeration and inter-industry agglomeration aggravates wage inequality. FDI spillover effects due to biased ownership and biased trade openness have positive and significant effect on wage inequality. Of course, degree increments of wage inequality are also affected by the positive impact of the relative supply of skilled labor and R&D input factors.
2014, Vol. 31 
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