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Rising between-workplace inequalities in high-income countries

Tomaskovic-Devey, Donald; Rainey, Anthony; Avent-Holt, Dustin; Bandelj, Nina; Boza, Istvan; Cort, David; Godechot, Olivier; Hajdu, Gergely; Hallsten, Martin; Henriksen, Lasse Folke; Hermansen, Are Skeie; Hou, Feng; Jung, Jiwook; Kanjuo-Mrcela, Aleksandra;

PROCEEDINGS OF THE NATIONAL ACADEMY OF SCIENCES OF THE UNITED STATES OF AMERICA
2020
VL / 117 - BP / 9277 - EP / 9283
abstract
It is well documented that earnings inequalities have risen in many high-income countries. Less clear are the linkages between rising income inequality and workplace dynamics, how within- and between-workplace inequality varies across countries, and to what extent these inequalities are moderated by national labor market institutions. In order to describe changes in the initial between- and within-firm market income distribution we analyze administrative records for 2,000,000,000+ job years nested within 50,000,000+ workplace years for 14 high-income countries in North America, Scandinavia, Continental and Eastern Europe, the Middle East, and East Asia. We find that countries vary a great deal in their levels and trends in earnings inequality but that the between-workplace share of wage inequality is growing in almost all countries examined and is in no country declining. We also find that earnings inequalities and the share of between-workplace inequalities are lower and grew less strongly in countries with stronger institutional employment protections and rose faster when these labor market protections weakened. Our findings suggest that firm-level restructuring and increasing wage inequalities between workplaces are more central contributors to rising income inequality than previously recognized.

AccesS level

Green published, Green accepted, Gold other

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