Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/261020 
Year of Publication: 
2020
Series/Report no.: 
Working Paper No. 2020-06
Publisher: 
The University of Utah, Department of Economics, Salt Lake City, UT
Abstract: 
The aim of this paper is to determine how wage inequality is likely to be affected by the current COVID-19 pandemic. I first estimate the impact that social distancing will have on US state-level employment using pre-crisis industry data. I then consider the joint impact of states' unemployment benefit programs and the federal CARES Act on national inequality using representative sampling and Markov-Chain-Monte-Carlo estimations. I find that while wage inequality is likely to improve in the short-run with the added federal subsidy, allowing this support to expire prematurely will result in a worsening of pre-crisis wage inequality.
Subjects: 
Wage inequality
unemployment
COVID-19
Markov-Chain-Monte-Carlo
Gibbs sampling
structuralist method
JEL: 
E24
E27
C15
Document Type: 
Working Paper

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