Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/121427
Authors: 
Jovicic, Sonja
Year of Publication: 
2015
Series/Report no.: 
Schumpeter Discussion Papers 2015-007
Abstract: 
This paper investigates how much of the difference in wage distributions is related to differences in skill distributions and whether a compressed wage distribution is associated with high unemployment across core OECD countries. Some countries that have more compressed (dispersed) wage structures simultaneously have more compressed (dispersed) skill structures as well, and according to many economists, variations in skill inequality can explain variations in wage inequality across different countries. Firstly, this paper examines the relationship between skill compression and wage compression; secondly, wage compression is linked to labor market outcomes in terms of employment. Compressed wage structure (usually caused by labor market institutions) is often seen as a cause for high unemployment in the low-skill sector. Does the wage compression hypothesis hold? Based on the PIAAC survey of adult skills for seventeen OECD countries, this paper seeks to shed light on these two important topics.
Subjects: 
wage distribution
earnings
skill distribution
employment
JEL: 
J31
J24
E24
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.