Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/326955 
Year of Publication: 
2024
Citation: 
[Journal:] SERIEs - Journal of the Spanish Economic Association [ISSN:] 1869-4195 [Volume:] 15 [Issue:] 2 [Year:] 2024 [Pages:] 203-234
Publisher: 
Springer, Heidelberg
Abstract: 
Occupational choice models predict that, ceteris paribus, countries with higher dispersion of skill will have higher market labour income inequality. However, an extended conclusion from empirical research is that cross-country variations in dispersion of skill explain little of the variation in income inequality. This paper identifies factors related to production and organization technologies that moderate the relationship between dispersion of skill and dispersion of income in occupational choice equilibrium outcomes and that, if not properly accounted for, can bias the results of the empirical studies that explain dispersion of income as a function of dispersion of skill. In particular, comparing equilibrium outcomes from occupational choices in economies that differ in the distribution of skill and in the efficiency of supervision hierarchies, the paper can explain why the US and Sweden have similar labour productivity, but income inequality is higher in the US than in Sweden, and why productivity is lower and income inequality is higher in Spain than in Sweden.
Subjects: 
Income inequality
Labour income
Occupational choice
Distributionof skills
Scale economies of skills
Organizational size diseconomies
JEL: 
J24
J31
J21
D31
D21
E24
I24
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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