It is a matter of debate whether freer trade under globalization leads to wage inequality between the skilled and unskilled. With fast growth in trade and quickly enlarged wage gap China is particularly concerned with this issue. This paper first develops a model in which unskilled labor is paid a homogeneous wage whereas skilled labor is paid a fixed wage equal to that of the unskilled plus a firm-specific dividend wage amount to the firm’s profit. The result shows that the dividend wage, i.e. wage gap, depends on the firm’s export share in total revenues: holding the firm’s productivity and demand, change in export share, which implies changes in trade circumstance, leads to change in wage gap. We then test the theoretical result by using abundant firm level data from the Industrial Survey 2004.2007 pro- vided by NBSC. The estimation indicates that a 1% increase in export share leads to a wage inequality enlargement by 3.5.4%. The result is robust to various alternatives.