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Displaying results 1 to 25 of 47.

  1. Intra-industry trade, endogenous technological change, wage inequality and welfare
    Author: De Santis, Roberto A.
    Published: 1999
    Publisher:  Inst. of World Economics, Kiel

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  2. Intra-industry trade, endogenous technological change, wage inequality and welfare
    Author: De Santis, Roberto A.
    Published: 2011
    Publisher:  ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft, Kiel

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  3. Occupational matching and cities
    Author: Papageorgiou, Theodore
    Published: 2020
    Publisher:  Boston College, Chestnut Hill, MA, USA

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    Series: Boston College working papers in economics ; 1011
    Subjects: Occupations; Agglomeration Economies; Urban Wage Premium; Multi-armed Bandits; Geographical Mobility; Matching Theory; Wage Inequality; Job Vacancy Postings
    Scope: 1 Online-Ressource (circa 57 Seiten), Illustrationen
  4. Market power and wage inequality
    Author: Deb, Shubhdeep; Eeckhout, Jan; Patel, Aseem; Warren, Lawrence
    Published: [2022]
    Publisher:  U.S. Census Bureau, Center for Economic Studies, Washington, DC

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    Series: Working papers / Center for Economic Studies, U.S. Census Bureau ; 22, 37 (September 2022)
    Subjects: Market Power; Wage Inequality; Skill Premium; Technological Change; Market Structure; Endogenous Markups; Endogenous Markdowns
    Scope: 1 Online-Ressource (circa 60 Seiten), Illustrationen
  5. Occupation growth, skill prices, and wage inequality
    Author: Böhm, Michael; Gaudecker, Hans-Martin von; Schran, Felix
    Published: May 2022
    Publisher:  ECONtribute, Bonn

    This paper studies the relationship between occupational employment, occupational wages, and rising wage inequality. We document that in all occupations, entrants and leavers earn less than stayers. This suggests selection effects that are negative... more

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    This paper studies the relationship between occupational employment, occupational wages, and rising wage inequality. We document that in all occupations, entrants and leavers earn less than stayers. This suggests selection effects that are negative for growing occupations and positive for shrinking ones. We estimate a model of occupational prices and skills, which includes occupation-specific skill accumulation and endogenous switching across many occupations. Consistent with leading explanations for occupational changes, estimated prices (i.e., selection-corrected wages) and occupational employment growth are positively related. Just over 40% of selection is due to age in the sense that marginal workers have had less time to accumulate skills. The remainder is due to Roy-type selection, i.e., workers reacting to changing prices and shocks unrelated to age. Skill prices establish a long-suspected quantitative connection between occupational changes and the surge in wage inequality.

     
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    Series: ECONtribute discussion paper ; no. 167
    Subjects: Skill Prices; Selection Effects; Multidimensional Skill Accumulation; Occupational Employment and Wages; Administrative Panel Data; Wage Inequality
    Scope: 1 Online-Ressource (circa 50 Seiten), Illustrationen
  6. Are manufacturing jobs still good jobs?
    an exploration of the manufacturing wage premium
    Author: Bayard, Kimberly; Cajner, Tomaz; Gregorich, Vivi; Tito, Maria D.
    Published: March 4, 2022
    Publisher:  Divisions of Research & Statistics and Monetary Affairs, Federal Reserve Board, Washington, D.C.

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    Series: Finance and economics discussion series ; 2022, 011
    Subjects: Wage Inequality; Manufacturing; Union Membership
    Scope: 1 Online-Ressource (circa 44 Seiten), Illustrationen
  7. Market power and wage inequality
    Author: Eeckhout, Jan
    Published: 04 October 2022
    Publisher:  Centre for Economic Policy Research, London

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    Series: Array ; DP17569
    Subjects: Market Power; Wage Inequality; Skill Premium; Technological Change; Market Structure; Endogenous Markups; Endogenous Markdowns
    Scope: 1 Online-Ressource (circa 62 Seiten), Illustrationen
  8. Wage inequality
    how and why it has changed over the decades
    Author: Koh, Young-sun
    Published: August 22, 2019
    Publisher:  KDI Communications Unit, Sejong-si

    From 1980 to 2016, Korea exhibited ups and downs in wage inequality and a slowdown in wage growth. - Wage inequality fell in the 1st phase (1980-1994), rose in the 2nd (1995-2007), and fell again in the 3rd (2008-2016). - The annual growth rate of... more

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    From 1980 to 2016, Korea exhibited ups and downs in wage inequality and a slowdown in wage growth. - Wage inequality fell in the 1st phase (1980-1994), rose in the 2nd (1995-2007), and fell again in the 3rd (2008-2016). - The annual growth rate of the real median wage plummeted from 9.2% in the 1st phase to 4.0% in the 2nd and then to 1.1% in the 3rd. - So far as wages are a form of compensation for the skills provided, wage inequality is affected by the changes in the supply of and demand for skills. - An important indicator of skill is the educational attainment of workers. The demand for high-school graduates rapidly increased in the 1st phase, weakening the wage premium of college graduates and reducing wage inequality. The situation reversed in the 2nd phase with a sharp upturn in the demand for college graduates, in their wage premium, and in wage inequality. In the 3rd phase, the wage premium of the latter dipped again as their supply continued amid the subdued demand for them. - The large demand for high-school graduates observed in the 1st phase may derive from the rising demand for mid-skilled workers by the heavy and chemical industry while the growing demand for college graduates observed in the 2nd phase may be the result of an increasing demand for high-skilled workers driven by technological progress. - To accelerate the wage growth while keeping wage inequality in check, technological progress should be encouraged and the quality of higher education upgraded.

     
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    Series: KDI policy forum ; no. 274 = 2019, 03
    Subjects: Wages; Labor Productivity; Wage Inequality
    Scope: 1 Online-Ressource (circa 8 Seiten)
  9. Decline in wage inequality in Brazil
    a survey
    Author: Firpo, Sergio; Portella, Alysson
    Published: December 2019
    Publisher:  World Bank Group, Poverty and Equity Global Practice, [Washington, DC, USA]

    In the last decades, Brazil experienced a historical decline in its wage inequality level, particularly in the first decade of the 21<sup>st</sup> century. This paper reviews the literature that attempted to explain the observed pattern. It considers... more

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    In the last decades, Brazil experienced a historical decline in its wage inequality level, particularly in the first decade of the 21st century. This paper reviews the literature that attempted to explain the observed pattern. It considers mechanisms related to the supply and demand for labor, as well as institutional factors. The paper argues that the favorable economic environment in the period, combined with increases in the minimum wage, higher formalization, and a larger supply of skilled workers led to a compression in wages. However, some aspects of the decline in wage inequality are still unanswered, such as the causes behind a reduction in the experience premium and interfirm payment heterogeneity, as well as the exact role of technological changes. The paper concludes by discussing future trends in wage inequality in Brazil

     
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    Source: Union catalogues
    Language: English
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    Series: Policy research working paper ; 9096
    World Bank E-Library Archive
    Subjects: Brazil; Wage Inequality; Income Distribution
    Scope: 1 Online-Ressource (circa 38 Seiten), Illustrationen
  10. International trade and within-sector wage inequality
    the case of South Korea
    Author: Lee, Siwook
    Published: October, 2016
    Publisher:  KDI School of Public Policy and Management, [Sejong-si, Republic of Korea]

    This paper studies which factors contributed to the changes in wage inequality in Korean manufacturing over the last three decades. By adopting Akerman et al. (2013)'s decomposition method, we examine the relative importance of within-sector and... more

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    This paper studies which factors contributed to the changes in wage inequality in Korean manufacturing over the last three decades. By adopting Akerman et al. (2013)'s decomposition method, we examine the relative importance of within-sector and between-sector wage variations in Korean manufacturing over the period of 1980-2012. Our analytic results confirm that within-sector wage variation explains the lion's share of overall wage inequality. Taking such finding into account, we estimate the impacts of international trade, skilled-biased technological change and labor market conditions on within-sector wage inequality in Korea. Our estimation results suggest that there was a structural change in determinants of wage inequality before and after the mid-1990s. The influence of international trade mainly through heightened import competition on wage dispersion became relatively more conspicuous over the last two decades

     
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    Series: KDI School working paper series ; 16, 14
    KDI School of Pub Policy & Management Paper ; No. 16-14
    Subjects: Wage Inequality; International Trade; FDI; Technological Change; Skill-intensity
    Scope: 1 Online-Ressource (circa 36 Seiten), Illustrationen
  11. Oligopsonies over the business cycle
    Author: Monte, Daniel; Pinheiro, Roberto
    Published: 2020
    Publisher:  Federal Reserve Bank of Cleveland, [Cleveland, OH]

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    Series: Working paper / Federal Reserve Bank of Cleveland ; 20, 06 (February 2020)
    Subjects: Duopsony; Labor Market Slack; Wage Inequality
    Scope: 1 Online-Ressource (circa 34 Seiten), Illustrationen
  12. Firm productivity, wages, and sorting
    Author: Lochner, Benjamin; Schulz, Bastian
    Published: 5 February 2020
    Publisher:  Institute for Employment Research of the Federal Employment Agency, Nürnberg

    Increasing wage inequality is associated with changes in the degree of labor market sorting, i.e. the allocation of workers to firms. To measure sorting, we propose a new method which disentangles the respective contributions of worker and firm... more

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    Increasing wage inequality is associated with changes in the degree of labor market sorting, i.e. the allocation of workers to firms. To measure sorting, we propose a new method which disentangles the respective contributions of worker and firm heterogeneity to wage inequality. Inspired by sorting theory, we infer firm productivity from estimating firm-level production functions, taking into account that worker ability and firm productivity may interact at the match level. Using German data, we find that highly productive firms display low labor shares, dominate concentrated markets, and pay lower wages than less productive firms. Sorting is positive, but lower than what wage-based measures suggest. It increases over time, driven by new matches between low-productivity firms and low-ability workers. At the top, sorting decreases, reflected in worker transitions away from high-productivity firms that pay relatively low wages. We discuss implications of our findings for the interpretation of increasing wage inequality. Wachsende Lohnungleichheit geht mit Veränderungen der Allokation von Arbeitnehmern zu Arbeitgebern im Arbeitsmarkt einher. Dies spiegelt sich auch in einem steigenden Sortierungsgrad des Arbeitsmarkts wider. Wir entwickeln eine neue Methode zur Messung dieses Sortierungsgrades, welche die jeweiligen Beiträge von Arbeitnehmer- und Arbeitgeberheterogenität zur Lohnungleichheit entflechtet. Inspiriert von theoretischen Modellen der Arbeitsmarktsortierung leiten wir die Produktivität der arbeitgebenden Unternehmen aus Schätzungen von Produktionsfunktionen auf der Firmenebene ab. Wir berücksichtigen dabei insbesondere, dass die Firmenproduktivität auf der Matchebene mit der Leistungsfähigkeit der einzelnen Arbeitnehmer interagieren könnte. Anhand deutscher Daten beobachten wir, dass hochproduktive Firmen niedrige Lohnquoten aufweisen, in konzentrierten Märkten operieren und geringere Löhne zahlen als weniger produktive Firmen. Der Sortierungsgrad ist positiv aber niedriger als lohnbasierte Maße nahelegen. Er steigt mit der Zeit, getrieben durch neue Matches zwischen relativ unproduktiven Firmen und weniger leistungsfähigen Arbeitnehmern. An der Spitze geht der Sortierungsgrad zurück, was sich darin widerspiegelt, dass Arbeitnehmer die produktivsten Firmen, die relativ geringe Löhne zahlen, verlassen. Wir diskutieren Implikationen unserer Ergebnisse für die Interpretation steigender Lohnungleichheit.

     
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    hdl: 10419/222389
    Series: IAB-discussion paper ; 2020, 04
    Subjects: Assortative Matching; Labor Market Sorting; Wage Inequality; Job Mobility; Unobserved Heterogeneity; Firm Productivity; Production Function Estimation
    Scope: 1 Online-Ressource (circa 77 Seiten), Illustrationen
  13. The effect of unfair chances and gender discrimination on labor supply
    Author: Gagnon, Nickolas; Bosmans, Kristof; Riedl, Arno
    Published: [2020]
    Publisher:  Graduate School of Business and Economics, Maastricht

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    Series: [Research memorandum] / Maastricht University, Graduate School of Business and Economics (GSBE) ; RM/20, 005
    Subjects: Labor Supply; Wage Inequality; Procedural Fairness; Gender Discrimination
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  14. Automation, robots and wage inequality in Germany
    a decomposition analysis
    Author: Brall, Franziska; Schmid, Ramona
    Published: [2020]
    Publisher:  University of Hohenheim, Dean's Office of the Faculty of Business, Economics and Social Sciences, Stuttgart, Germany

    We analyze how and through which channels wage inequality is affected by the rise in automation and robotization in the manufacturing sector in Germany from 1996 to 2017. Combining rich linked employer-employee data accounting for a variety of... more

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    We analyze how and through which channels wage inequality is affected by the rise in automation and robotization in the manufacturing sector in Germany from 1996 to 2017. Combining rich linked employer-employee data accounting for a variety of different individual, firm and industry characteristics with data on industrial robots and automation probabilities of occupations, we are able to disentangle different potential causes behind changes in wage inequality in Germany. We apply the recentered influence function (RIF) regression based Oaxaca-Blinder (OB) decomposition on several inequality indices and find evidence that besides personal characteristics like age and education the rise in automation and robotization contributes significantly to wage inequality in Germany. Structural shifts in the workforce composition towards occupations with lower or medium automation threat lead to higher wage inequality, which is observable over the whole considered time period. The effect of automation on the wage structure results in higher inequality in the 1990s and 2000s, while it has a significant decreasing inequality effect for the upper part of the wage distribution in the more recent time period.

     
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    hdl: 10419/225632
    Series: Hohenheim discussion papers in business, economics and social sciences ; 2020, 14
    Subjects: Roboter; Automation; Lohn; Lohnentwicklung; Wage Inequality; Automation; Robots; Decomposition Method; RIFregression; Linked employer - employee data; Germany
    Scope: 1 Online-Ressource (80 Seiten), Diagramme
  15. Redistributive income taxation with directed technical change
    Author: Loebbing, Jonas
    Published: January 2020
    Publisher:  Verein für Socialpolitik, [Köln]

    This paper studies the implications of (endogenously) directed technical change for the design of non-linear labor income taxes in a Mirrleesian economy augmented to include endogenous technology development and adoption choices by firms. First, I... more

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    This paper studies the implications of (endogenously) directed technical change for the design of non-linear labor income taxes in a Mirrleesian economy augmented to include endogenous technology development and adoption choices by firms. First, I identify conditions under which any progressive tax reform induces technical change that compresses the pre-tax wage distribution. The key intuition is that progressive tax reforms tend to increase labor supply of less skilled relative to more skilled workers, which induces firms to develop and use technologies that are more complementary to the less skilled. Second, I provide conditions under which the endogenous response of technology raises the welfare gains from progressive tax reforms. Third, I show that directed technical change effects make the optimal tax scheme more progressive, raising marginal tax rates at the right tail of the income distribution and lowering them (potentially below zero) at the left tail. For reasonable calibrations, the directed technical change effects of actual tax reforms on wage inequality appear to be small, but the impact of directed technical change on optimal taxes is considerable. Optimal marginal tax rates increase monotonically over the bulk of the income distribution instead of being U-shaped (as in most of the previous literature) and marginal tax rates on incomes below the median are reduced substantially

     
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    Series: Jahrestagung 2020 / Verein für Socialpolitik ; 89
    Subjects: Optimal Taxation; Directed TechnicalChange; Endogenous Technical Change; Wage Inequality
    Scope: 1 Online-Ressource (circa 98 Seiten), Illustrationen
  16. Monopolistic competition, optimum product diversity, and international trade
    the role of factor endowment and factor intensities
    Author: Marjit, Sugata; Mandal, Biswajit
    Published: 2021
    Publisher:  Global Labor Organization (GLO), Essen

    In this paper we revisit the influential theory of monopolistic competition and optimum product variety as developed by Dixit and Stiglitz (1977) with applications in international trade by Krugman (1979,1980), by modeling fixed and variable costs of... more

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    In this paper we revisit the influential theory of monopolistic competition and optimum product variety as developed by Dixit and Stiglitz (1977) with applications in international trade by Krugman (1979,1980), by modeling fixed and variable costs of production in terms of underlying use of skilled and unskilled labor in a single good model. This is different from earlier work on multi sector variant of Krugman cum Heckscher-Ohlin-Samuelson model such as Helpman (1981) and others. In our structure factor endowment and factor intensities determine both number of varieties and output per variety in a closed economy mimicking the features of Heckscher-Ohlin-Samuelson model. Differences in factor endowments across countries determine the pattern of trade between varieties and output per variety, which is indeterminate in a standard single good Dixit-Stiglitz-Krugman model. Later we reflect on wage inequality and unemployment providing some interesting results.

     
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    Edition: This draft August, 2021
    Series: GLO discussion paper ; no. 911
    Subjects: Monopolistic Competition; Trade; Wage Inequality; Unemployment
    Scope: 1 Online-Ressource (circa 21 Seiten), Illustrationen
  17. Occupational choice, human capital and learning
    a multi-armed bandit approach
    Author: Lopes de Melo, Rafael; Papageorgiou, Theodore
    Published: [2024]
    Publisher:  Boston College, Chestnut Hill, MA, USA

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    Series: Boston College working papers in economics ; 1076
    Subjects: human Capital; Occupations; Multi-armed Bandits; Worker Mobility; Learning; In-formation and Human Capital Spillovers; Wage Inequality; Gittins Index
    Scope: 1 Online-Ressource (circa 28 Seiten), Illustrationen
  18. Job mobility and assortative matching
    Author: Braunschweig, Luisa; Dauth, Wolfgang; Roth, Duncan
    Published: September 2, 2024
    Publisher:  Institute for Employment Research of the Federal Employment Agency, Nürnberg, Germany

    We examine the development of worker-firm matching over the career due to job mobility. Using administrative employer-employee data covering the universe of German employees, we measure the degree of assortative matching as the correlation of worker... more

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    We examine the development of worker-firm matching over the career due to job mobility. Using administrative employer-employee data covering the universe of German employees, we measure the degree of assortative matching as the correlation of worker and firm quality measures obtained from a wage decomposition in the style of Abowd/Kramarz/Margolis (1999). We also introduce a novel measure based on the distance between the estimates of worker and firm quality. Both measures indicate that the degree of assortative matching, on average, increases with each job move. For high-quality workers, this can be explained by job ladder models as these workers move to higher-quality firms. Low-quality workers are matched less assortatively at the beginning of their careers, but also manage to climb the job ladder at first. For this group, the increase in assortative matching increases afer the third job, when they fall down the job ladder. Changes in worker-firm matching are also relevant for the extent of life cycle inequality. We estimate that the increase in assortative matching accounts for around 25 percent of the increase in wage inequality over the life cycle. Wir analysieren, wie sich das Matching zwischen Betrieben und Beschäfigten über das Erwerbsleben durch Jobmobilität verändert. Wir nutzen deutsche administrative Daten, die sowohl Informationen über Beschäfigte als auch Betriebe enthalten. Um assortatives Matching zu messen, berechnen wir die Korrelation zwischen zeitkonstanten Lohnkomponenten von Betrieben und Beschäfigten, welche wir aus einer Lohndekomposition im Stil von Abowd/Kramarz/Margolis (1999) ziehen. Zudem benutzen wir ein neues MaSS für assortatives Matching, welches auf der Distanz zwischen diesen Lohnkomponenten basiert. Beide MaSSe zeigen, dass der Grad des assortativen Matchings im Durchschnitt mit jedem weiteren Betriebswechsel ansteigt. Bei Beschäfigten mit einer hohen zeitkonstanten Lohnkomponente kann dies durch Job Ladder Modelle erklärt werden, denn die Beschäfigten bewegen sich zu Firmen mit höheren Lohnkomponenten. Dahingegen sind Beschäfigte mit niedrigerer Lohnkomponente am Anfang des Erwerbslebens in weniger assortativen Matches zu finden, da sie es ebenfalls schafen, zu Beginn die Job Ladder hinaufzuklettern. Für sie beginnt der Anstieg des assortativen Matchings erst nach dem dritten Job, wenn sie von der Job Ladder fallen. Die Entwicklung des assortativen Matchings ist zudem relevant für die Lohnungleichheit im Lebensverlauf. Wir zeigen, dass der Anstieg des assortativen Matchings circa 25 Prozent des Anstiegs der Lohnungleichheit im Lebensverlauf erklären kann.

     
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    hdl: 10419/302906
    Series: IAB-discussion paper ; 2024, 11
    Subjects: Assortative Matching; Wage Decomposition; Job Mobility; Life Cycle; Wage Inequality; Firms
    Scope: 1 Online-Ressource (circa 53 Seiten), Illustrationen
  19. Firm productivity, wages, and sorting
    Author: Lochner, Benjamin; Schulz, Bastian
    Published: [2021]
    Publisher:  Aarhus BSS, Department of Economics and Business Economics, Aarhus University, Aarhus

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    Series: Economics working papers ; 2021, 04
    Subjects: Assortative Matching; Labor Market Sorting; Wage Inequality; Job Mobility; Unobserved Heterogeneity; Firm Productivity; Production Function Estimation
    Scope: 1 Online-Ressource (circa 60 Seiten), Illustrationen
  20. The structure of financial systems and top incomes in advanced economies
    a comparative distributional analysis of the financial wage premium
    Author: Roberts, Anthony; Kwon, Roy
    Published: December 2021
    Publisher:  Luxembourg Income Study (LIS), asbl, Luxembourg

    Prior country case studies show substantial wage premiums in the financial sector contributes to growth of top incomes and wage inequality in a select group of advanced economies. However, while comparative studies show financialization exerts... more

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    Prior country case studies show substantial wage premiums in the financial sector contributes to growth of top incomes and wage inequality in a select group of advanced economies. However, while comparative studies show financialization exerts heterogenous effects on wage inequality across advanced economies, it is unclear whether the magnitude and location of financial wage premium in the distribution of income varies across advanced economies. We address this gap in the empirical literature by examining the financial wage premium across the labor income distributions of 13 advanced economies since the 1980s using harmonized labor force data from multiple waves of the Luxembourg Income Study. Consistent with prior studies, we find the financial wage premium is concentrated at the upper end of the income distribution in most advanced economies, but the magnitude of the premium substantially varies across these economies. We account for this variation by showing the market structure of financial systems exacerbates the financial wage premium at the upper end of the distribution. Overall, this study shows the financial wage premium is an important distributional mechanism for understanding the growth of top incomes and wage inequality in advanced economies and the marketization of financial activity amplifies the wage dynamics of financialization.

     
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    Series: LIS working paper series ; no. 822
    Subjects: Financialization; Top Incomes; Wage Inequality; Economic Methodology; Comparative Sociology
    Scope: 1 Online-Ressource (circa 48 Seiten), Illustrationen
  21. Market power and wage inequality
    Author: Deb, Shubhdeep; Eeckhout, Jan; Patel, Aseem; Warren, Lawrence
    Published: [2022]
    Publisher:  Institute for Fiscal Studies, [London]

    We propose a theory of how market power affects wage inequality. We ask how goods and labor market power jointly affect the level of wages, the Skill Premium, and wage inequality. We then use detailed microdata from the US Census between 1997 and... more

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    We propose a theory of how market power affects wage inequality. We ask how goods and labor market power jointly affect the level of wages, the Skill Premium, and wage inequality. We then use detailed microdata from the US Census between 1997 and 2016 to estimate the parameters of labor supply, technology and the market structure. We find that a less competitive market structure lowers the wage level, contributes 7% to the rise in the Skill Premium and accounts for half of the increase in between-establishment wage variance.

     
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    Series: Working paper / lnstitute for Fiscal Studies ; 22, 40
    Subjects: Market Power; Wage Inequality; Skill Premium; Technological Change; Market Structure; Endogenous Markups; Endogenous Markdowns
    Scope: 1 Online-Ressource (circa 60 Seiten), Illustrationen
  22. Immunity-driven comparative advantage and its palliative effect on social health and inequality
    a theoretical perspective
    Author: Marjit, Sugata; Das, Gouranga Gopal
    Published: [2023]
    Publisher:  Global Labor Organization (GLO), Essen

    We propose a model of "trade" between high income and low-income groups where the rich being scared of the spread of infection hires the poor to engage them in exposure-intensive outdoor activities as workers in the household industry. People who... more

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    We propose a model of "trade" between high income and low-income groups where the rich being scared of the spread of infection hires the poor to engage them in exposure-intensive outdoor activities as workers in the household industry. People who endure hardships and sustain exposure to unhygienic conditions may develop stronger immunity to fight the ongoing pandemic than members of the privileged class. The low-income group has greater endowment of immunity to income and for the rich it is lower. If such exchange takes place, essentially less immune people are withdrawn from exposure intensive activities and are being substituted by more immune workers. Thus, the spread and fatality will reduce with such a trade. The greater is the inequality, the more would be demand for labor for such work resulting in greater volume of such trade between low income and high-income workers. Thus, spread of the disease will be lower for countries where inequality is high. Later under a general equilibrium setting, we show that, ceteris paribus, a pandemic with a significant threat of infection and fatality would mean greater demand for poor workers; their income would rise and inequality would decline. If the pandemic increases demand for the top skilled, such as the case with virtual activities and derived demand for low skilled, relative wage for the top and bottom would increase.

     
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    hdl: 10419/270309
    Series: GLO discussion paper ; no. 1252
    Subjects: Covid; Exposure-intensity; Gig economy; Wage Inequality; Herd-immunity; Comparative Advantage; Welfare; General Equilibrium
    Scope: 1 Online-Ressource (circa 23 Seiten), Illustrationen
  23. Education expansion and income inequality
    empirical evidence from China
    Author: Hu, Xiaoshan; Wan, Guanghua; Zuo, Congmin
    Published: 4 December 2023
    Publisher:  BOFIT, the Bank of Finland Institute for Emerging Economies, Helsinki

    Education has long been perceived as a great equalizer, but even with universal rises in schooling years, income distribution worsened world-wide. We propose a method for decomposing the contribution of a variable to the change in inequality into... more

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    Education has long been perceived as a great equalizer, but even with universal rises in schooling years, income distribution worsened world-wide. We propose a method for decomposing the contribution of a variable to the change in inequality into mean, dispersion, and price components. The proposed method is then used to investigate the roles of the education variable in driving down China's wage inequality between 2010 and 2018. We find that (1) education accounted for over 30% of total wage inequality in 2010 and 2018; (2) 70% of the overall decline in wage inequality from 2010 to 2018 can be attributed to education expansion, and (3) the 70% inequality-reducing effect was made up of 95% benign dispersion and price components and 25% malign mean component. The benign components are attributable to an improvement in educational equity and a decrease in the college premium.

     
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    Series: BOFIT discussion papers ; 2023, 7
    Subjects: Education Expansion; Wage Inequality; Rate of Return to Education; China
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  24. Inefficient labor market sorting
    Author: Eckel, Carsten; Yeaple, Stephen R.
    Published: [2023]
    Publisher:  Collaborative Research Center Transregio 190, [München]

    A growing empirical literature attributes much of the productivity advantages of large, "superstar" firms to their adoption of best practice management techniques that allow them to better identify and use talented workers. The reasons for the... more

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    A growing empirical literature attributes much of the productivity advantages of large, "superstar" firms to their adoption of best practice management techniques that allow them to better identify and use talented workers. The reasons for the incomplete adoption of these "structured management practices" and their welfare implications are not well understood. This paper provides a positive and normative analysis of these issues in a theoretical framework in which structured management practices induce sorting of talent across firms. Incomplete adoption arises because worker talent is in limited supply. In equilibrium there is excessive adoption of structured management practices and too much sorting of talented workers into large firms. In this second-best environment, policy changes that favor large firms, such as trade liberalization, have the potential to lower welfare.

     
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    Series: Discussion paper / Rationality & Competition, CRC TRR 190 ; no. 437 (October 23, 2023)
    Subjects: Labor Market Imperfections; Misallocation; Productivity; Wage Inequality; International Trade; Welfare
    Scope: 1 Online-Ressource (circa 52 Seiten), Illustrationen
  25. Redistributive income taxation with directed technical change
    Author: Löbbing, Jonas
    Published: [2023]
    Publisher:  Collaborative Research Center Transregio 190, [München]

    What are the implications of (endogenous) directed technical change for the design of redistributive income taxes? I study this question in a Mirrleesian economy augmented to include endogenous technology development and adoption choices by firms.... more

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    What are the implications of (endogenous) directed technical change for the design of redistributive income taxes? I study this question in a Mirrleesian economy augmented to include endogenous technology development and adoption choices by firms. Under certain conditions, any progressive tax reform induces technical change that compresses the pre-tax wage distribution. The key intuition is that progressive tax reforms tend to increase labor supply of less skilled relative to more skilled workers, which induces firms to develop and use technologies that are more complementary to the less skilled. These directed technical change effects make the optimal tax scheme more progressive, raising marginal tax rates at the right tail of the income distribution and lowering them at the left tail. For reasonable calibrations, the impact of directed technical change on the optimal tax is quantitatively important: optimal marginal tax rates are reduced substantially for incomes below the median and increase monotonically over the bulk of the income distribution instead of being U-shaped (as in most of the previous literature).

     
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    Series: Discussion paper / Rationality & Competition, CRC TRR 190 ; no. 420 (August 25, 2023)
    Subjects: Optimal Taxation; Directed Technical Change; Endogenous Technical Change; Wage Inequality
    Scope: 1 Online-Ressource (circa 94 Seiten), Illustrationen