Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/114144
Authors: 
Leonardi, Marco
Pellizzari, Michele
Tabasso, Domenico
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 9254
Abstract: 
We study the distributional effect of a wage indexation mechanism - the Scala Mobile (SM) - that heavily compressed the distribution of Italian wages during the 1970s and 1980s. The SM imposed large real wage increases at the bottom of the distribution and was essentially irrelevant for high-wage workers. We document that this mechanism triggered a strong redistribution within the firm. Skilled workers received lower wage adjustments when employed at firms with many unskilled workers and they tended to move towards more skill-intensive firms. We rationalize these findings with a simplified model of intra-firm bargaining with on-the- job search.
Subjects: 
labor market institutions
wage indexation
inequality
intra-firm bargaining
JEL: 
J01
J31
J50
Document Type: 
Working Paper

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