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It's where you work: increases in earnings dispersion across establishments and individuals in the U.S.

Barth, Erling and Bryson, Alex and Davis, James C. and Freeman, Richard (2014) It's where you work: increases in earnings dispersion across establishments and individuals in the U.S. NBER working paper, 20447. National Bureau of Economic Research, Cambridge, Mass.

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Abstract

This paper links data on establishments and individuals to analyze the role of establishments in the increase in inequality that has become a central topic in economic analysis and policy debate. It decomposes changes in the variance of ln earnings among individuals into the part due to changes in earnings among establishments and the part due to changes in earnings within-establishments and finds that much of the 1970s-2010s increase in earnings inequality results from increased dispersion of the earnings among the establishments where individuals work. It also shows that the divergence of establishment earnings occurred within and across industries and was associated with increased variance of revenues per worker. Our results direct attention to the fundamental role of establishment-level pay setting and economic adjustments in earnings inequality.

Item Type: Monograph (Working Paper)
Official URL: http://www.nber.org/papers/w9395
Additional Information: © 2014 The Authors, NBER
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor
Sets: Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 12 Dec 2014 11:41
Last Modified: 12 Dec 2014 11:41
Funders: Labor and Worklife Program at Harvard University, National Bureau of Economic Research, Norwegian Research Council (project 173591/S20)
URI: http://eprints.lse.ac.uk/id/eprint/60494

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