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Job and wage mobility can arise from firms and workers learning about workers' ability and from workers acquiring human capital with experience. To date, the relative importance of these two mechanisms is debated. Using administrative data from one firm, I estimate a structural model that integrates them. I find the direct effect of beliefs about ability on wages, which existing work has focused on, to be small. However, by improving the sorting of workers to the firm's jobs, learning about ability is indirectly a crucial determinant of wage growth and dispersion. [ABSTRACT FROM AUTHOR]

We revisit the estimation of industry wage differentials using linked employer-employee data. Cross-sectional industry differences overstate pay premiums due to unmeasured heterogeneity. Estimates based on models with person and industry effects understate true premiums: workers who switch to a higher-premium industry typically move from higher-paying firms in their origin industry to lower-paying firms in their destination (and vice versa). The corrected standard deviation of log wage effects is 0.122 across narrowly defined industries and is similar at higher levels of aggregation. Higher-skilled workers sort to higher-pay industries. Premiums and worker sorting are more variable in cities with higher-wage firms and higher-skilled workers. [ABSTRACT FROM AUTHOR]

We study the extent to which employer heterogeneity affects gender gaps in earnings across the distribution, over time, and over the life cycle, accounting for cohort effects. Using a linked employer-employee dataset for Italy, we show that the gender gap in firm pay premia explains 34% of the mean gender pay gap, mainly due to between-firm components. Within-firm differences are more important at the top of the distribution and have become more relevant over time. Gender differences in mobility toward firms with higher pay premia and within-firm gender inequality partly explain the gender gap in firm pay premia. [ABSTRACT FROM AUTHOR]

Rising between-firm pay dispersion accounts for the majority of the dramatic increase in earnings inequality in the United States in the last several decades. This paper shows that a distinct cross-cohort pattern drives this rise: newer cohorts of firms enter more dispersed and stay more dispersed throughout their lives. These cohort patterns suggest a link between changes in firm entry associated with the decline in business dynamism and the rise in earnings inequality. Cohort effects also imply a slow diffusion of inequality: inequality rises as younger and more unequal cohorts of firms replace older and more equal cohorts. [ABSTRACT FROM AUTHOR]

This paper develops measures of the occupational homogeneity of employers as indicators of outsourcing. Findings are threefold. First, wages are strongly related to occupational homogeneity, particularly for workers in low-wage occupations. Second, by some measures, workers—particularly those in higher-wage occupations—saw their employing establishments become more occupationally homogeneous during 2004–19. Third, changes in the occupational homogeneity of workplaces contributed to growing wage inequality among workers over the first part of this period. The growing sorting and segregation of workers by occupation into different employers is an important part of wage inequality. [ABSTRACT FROM AUTHOR]

Monthly wage inequality in Germany continued to increase in the early 2000s, which is mainly explained by a rising part-time employment share. After 2010, inequality returned to the level of 2000. About half of the recent decrease is due to the introduction of the national minimum wage in 2015. While employment effects of the minimum wage are negligible, we find strong wage increases among the existing workforce. The minimum wage lowered wage inequality within eastern and western Germany but also led to a convergence of the east-west wage differential. The increased labor incomes were not offset by decreasing social benefits. [ABSTRACT FROM AUTHOR]

Rebecca Diamond, a professor of economics at Stanford Graduate School of Business, has been awarded the Sherwin Rosen Prize by the Society of Labor Economists for her outstanding contributions to the field. Diamond has made significant contributions to labor economics, particularly in the areas of urban issues, housing, spatial sorting, and inequality. Her research on the economic implications of divergent location choices by workers of different skill levels has shown that geographic sorting has led to welfare changes that go beyond the growth in the college wage premium alone. Diamond has also studied the impact of rent control on housing supply and affordability, as well as the effects of high-skilled immigration, gender wage gaps, and nutritional inequality. The Society of Labor Economists is pleased to recognize Diamond's achievements with this prestigious award. [Extracted from the article]

We explore firm size heterogeneity in production networks. In comprehensive data for Belgium, firms with more customers have higher total sales but lower sales and lower market shares per customer. Downstream factors, especially the number of customers, explain the vast majority of firm size dispersion. We rationalize these facts with a model of network formation and two-dimensional firm heterogeneity. Higher productivity generates more matches and larger market shares among customers. Higher relationship capability generates more customers and higher sales. Model estimates suggest a strong negative correlation between productivity and relationship capability and potentially large welfare gains from improving relationship capability. [ABSTRACT FROM AUTHOR]

School quality affects upward mobility in educational attainment. This conclusion comes from an analysis of families with coresident teenage children in the 1940 census. We study parents in the bottom quartile of the education distribution and define "upward mobility" as a generational move up the educational ladder to the top three quartiles of the child's cohort. At the state level, upward mobility is strongly tied to teacher wages. This relationship holds when we narrow our focus to families on adjacent sides of state borders in the South, where state minimum salary laws created sharp teacher-wage differences between otherwise similar counties. [ABSTRACT FROM AUTHOR]

We analyze the impact of Ford Motor Company's compensation practices on the Detroit-area labor market from 1918 to 1947. Previous studies imply that Ford paid race-independent wages, but its Black workers were sorted into undesirable departments. We extend these results using propensity score reweighting of census data and Ford's records and confirm that Ford paid equal wages. We then develop a search model with discriminatory and equal wage firms to assess the impact of Ford's policy on the larger labor market. Calibrated simulations suggest that Ford may have reduced the wage gap in southeastern Michigan by as much as 50%. [ABSTRACT FROM AUTHOR]

The within-firm gender wage gap is an important part of the overall gender gap in the labor market. This paper describes how parenthood is associated with the within-firm gender gap using a personnel data set from a large Chinese company. The wage gap is small in the early stages of careers and becomes increasingly evident when female employees get married and have children. Whereas the short-term peak around childbirth can be explained by women' reduced working hours, the long-term trend is caused by women's concentration in lower-level jobs. Our study highlights the importance of internal gender segregation in understanding gender differentials. [ABSTRACT FROM AUTHOR]

This paper analyzes the effect of immigration on gender gaps. Using an equilibrium structural model for the US economy, I simulate the importance of two mechanisms: the differential increase in labor market competition from immigration on male and female workers and the availability of cheaper childcare services. Aggregate effects on gender and participation gaps are negligible. Females are more negatively affected by labor market competition, but the availability of cheaper childcare compensates for these effects. This generates heterogeneity in the effects along skill distribution: gender gaps are increased at the bottom and reduced at the top. Human capital adjustments are also heterogeneous. [ABSTRACT FROM AUTHOR]

Earnings nonresponse in household surveys is widespread, yet there is limited knowledge of how nonresponse biases earnings measures. We examine the consequences of nonresponse on earnings gaps and inequality using Current Population Survey individual records linked to administrative earnings data. The common assumption that earnings are missing at random is rejected. Nonresponse across the earnings distribution is U-shaped, highest in the left and right tails. Inequality measures differ between household and administrative data due in part to nonresponse. Nonresponse biases earnings differentials by race, gender, and education, particularly in the tails. Flexible copula-based models can account for nonrandom nonresponse. [ABSTRACT FROM AUTHOR]

This paper documents differences in lifetime earnings risk across occupations due to wage risk, employment risk, and midcareer occupation changes, which can mitigate other shocks. Total lifetime earnings risk varies considerably across starting occupation, and riskier occupations pay more in expectation. The average worker would give up at least 9% of total lifetime earnings in the least certain occupation to reduce the riskiness of that occupation to the level of the safest starting occupation. The insurance value of occupational mobility is quantitatively important. With mobility, workers absorb only 60%, on average, of negative occupation-specific wage shocks. [ABSTRACT FROM AUTHOR]

We use a rich new body of data on the experiences of unemployed job seekers to determine the sources of wage dispersion and to create a search model consistent with the acceptance decisions the job seekers made. We identify the distributions of four key variables: offered wages, offered nonwage job values, job seekers’ nonwork alternatives, and job seekers’ personal productivities. We find that, conditional on personal productivity, the standard deviation of offered log wages is moderate, at 0.24, whereas the dispersion of the offered nonwage component is substantially larger, at 0.34. The resulting dispersion of offered job values is 0.38. [ABSTRACT FROM AUTHOR]

We examine whether dynastic human capital (DHC) can explain the black-white wage gap. We fit a quantity-quality model to state-level data on fertility, mortality, and schooling but, notably, not earnings. Racial discrimination raised the cost of black schooling, thus depressing DHC not only of the current generation but of future generations via its role in producing human capital. Birth-state DHC helps explain the wage gap among stayers, while current-state DHC helps explain the gap among movers. These findings highlight the role of intergenerational transmission in the persistence of the wage gap and the role of migration in reducing it. [ABSTRACT FROM AUTHOR]

We present a task-based model in which high- and low-skill workers compete against machines in the production of tasks. Low-skill (high-skill) automation corresponds to tasks performed by low-skill (high-skill) labor being taken over by capital. Automation displaces the type of labor it directly affects, depressing its wage. Through ripple effects, automation also affects the real wage of other workers. Counteracting these forces, automation creates a positive productivity effect, pushing up the price of all factors. Because capital adjusts to keep the interest rate constant, the productivity effect dominates in the long run. Finally, low-skill (high-skill) automation increases (reduces) wage inequality. [ABSTRACT FROM AUTHOR]

Why do firms pay different wages? Empirical evidence suggests the presence of substantial differences in firm pay controlling for worker skill. Moreover, these differences are uncorrelated with skills, indicating the absence of sorting. I show that the face value interpretation is inconsistent with evidence on coworker segregation. I interpret the evidence by applying a sorting model and show that the correlation is biased. I identify nonmonotonicities in wages as the reason for this bias and show that a measure of worker-coworker sorting is more accurate. By calibrating the model to US data, I confirm that the model matches many job market characteristics. [ABSTRACT FROM AUTHOR]

Most labor market search models ignore the fact that decisions are often made at the household level. We fill this gap by developing and estimating a household search model with on-the-job search and labor supply. We find that ignoring the household as a decision-making unit has relevant empirical consequences. In estimation, the individual search model implies gender wage offer differentials almost twice as large as the household search model. In the application, the individual search model implies female lifetime inequality 30% lower than the household search model. Labor market policy effects on lifetime inequality are also sensitive to the specification. [ABSTRACT FROM AUTHOR]

This paper documents the gender gap in performance among highskilled professionals in the United States. On the basis of widely used performance measures in law firms, we find that male lawyers bill 10 percent more hours and bring in more than twice as much new client revenue as female lawyers. The differential impact across genders in the presence of young children and differences in aspirations to become a law firm partner account for a large share of the difference in performance. We show that accounting for performance has important consequences for gender gaps in lawyers' earnings and subsequent promotion. [ABSTRACT FROM AUTHOR]

Competing explanations for the long-standing gap between black and white earnings attribute different weight to wage discrimination and human capital differences. Using new data on local school quality, we find that human capital played a predominant role in determining 1940 wage and occupational status gaps in the South despite entrenched racial discrimination in civic life and the lack of federal employment protections. The resulting wage gap coincides with the higher end of the range of estimates from the post-Civil Rights era. We estimate that truly "separate but equal" schools would have reduced wage inequality by 29%-48%. [ABSTRACT FROM AUTHOR]

We study the distributional consequences of trade in a world with two industries and two heterogeneous factors of production. Productivity in each production unit reflects the ability of the manager and the abilities of the workers, with complementarity between the two.We begin by examining the forces that govern the sorting of worker and manager types to industries and the matching of workers and managers within industries. We then consider how changes in relative output prices generated by changes in the trading environment affect sorting, matching, and the distributions of wages and salaries. [ABSTRACT FROM AUTHOR]

Government employment programs for low-skilled workers typically emphasize rapid placement of participants into jobs, of which many are temporary-help jobs. Using data from Detroit’s welfare-to-work program and the Chernozhukov-Hansen instrumental variables quantile regressionmethod,we find that neither direct-hire nor temporary-help job placements significantly affect the lower tail of the earnings distribution. Inthe upper tail, direct-hireplacements yield sizable earnings increases for over half of participants, while temporary-help placements yield significant earnings losses at higher quantiles. Our results cast doubt on the efficacy of employment programs’ exclusive focus on rapid job placement and their widespread reliance on temporary-help placements. [ABSTRACT FROM AUTHOR]

Major shifts in gender, work, and sexuality have led to the rising prominence of display work, the display of sexualized bodily capital for wages. This article develops the concept of display work and examines its implications for the gendered organization of work. Display work is a continuous rather than a categorical variable and can describe a range of jobs from those involving overtly sexualized bodies for sale as bodies to professionalized bodies on display. Within the field of display work, we identify a paradox: among some display workers, women earn significantly more than men, a wage gap that reverses the enduring pattern of gendered wage inequality in the broader labor market. This article flips the typical line of inquiry by comparing earnings and career dynamics among performers in fashion modeling, pornography, and stripping, three cases of display work characterized by clear inverted wage gaps. We argue that in the field of display work, freelance and winner-take-all workplace structures intersect with cultural norms that devalue the sexualized display of male bodies, resulting in men's lower pay. We conclude with implications for feminist studies of the postindustrial workplace, drawing from key tenets in sociology of sexuality, culture, and gendered organizations. [ABSTRACT FROM AUTHOR]

We measure impacts of entry conditions on labor market outcomes for the US college graduating classes of 1974-2011. A large recession reduces initial earnings by 10%, through full-time work and wages, with small persistent impacts on wages. Those in high-paying majors experience smaller impacts on most labor market outcomes, widening earnings inequality across majors. In the Great Recession, early earnings losses are much larger than predicted given past patterns and the size of the recession. This is partially because the cyclical sensitivity of demand for college graduates has more than doubled. Recession effects also became more evenly distributed across majors. [ABSTRACT FROM AUTHOR]

Using 1979-2012 CPS data for the United States and 1975-2012 NES data for Great Britain, we study wage behavior in both countries, with particular attention to the Great Recession. Real wages are procyclical in both countries, but the procyclicality of real wages varies across recessions, and does so differently between the two countries, in ways that defy simple explanations. We devote particular attention to the hypothesis that downward nominal wage rigidity plays an important role in cyclical employment and unemployment fluctuations. We conclude that downward wage rigidity may be less binding and have lesser allocative consequences than is often supposed. [ABSTRACT FROM AUTHOR]

A literary criticism of the book "Capital in the 21st Century," by Thomas Piketty and translated by Arthur Goldhammer is presented. Topics discussed include the increase in socio-economic inequality, level of inequality of income from labor, and distinction between capital and labor in the U.S. Also mentioned are the factor for wage inequality, reason of supermanagers' higher compensation, and impact of education, skill, and technology for the income differences in the country.

Using data from the NLSY79, this paper considers the role of gender in promotion and promotion-related earnings development over the course of a career. The raw data suggest reasonably favorable promotion outcomes for females over a career, but any such advantages are found to be confined to less educated females. Further, the strong returns to education in later career stemming from promotion-related earnings growth accrue solely to males. While consistent with fertility timing and choice on the part of educated females, this earnings result is not inconsistent with discrimination as well, reminiscent of findings from an earlier human capital literature. [ABSTRACT FROM AUTHOR]

We use a dynamic modeling strategy to evaluate two potential avenues through which health differences generate a wage gap: directly through reductions in health capital and indirectly through employment transitions that reduce human capital (specifically, occupation and employer tenure). Our results suggest that male workers with a moderate disability are 23 percent more likely to change occupations or employers than nondisabled men. Compared to those who do not make a transition, workers with a moderate disability who change occupations and employers experience an immediate $0.30 decline in hourly wages on top of a $0.57 decline associated with the disability onset. [ABSTRACT FROM AUTHOR]

Women with children earn less than women without children. I study this wage gap using a dynamic model of human capital accumulation with endogenous time and effort allocation between household and market activities. Selection into motherhood does not drive the gap in hourly wage. I decompose this gap into forgone human capital and changing effort at work. Human capital depreciates as a result of maternity leave and accumulates at a lower rate after childbirth because of a reduction in work hours. Effort at work does not decline after childbirth. Reduced human capital accumulation explains the entire postmotherhood loss in hourly wage. [ABSTRACT FROM AUTHOR]

The extent to which discrimination can explain racial wage gaps is one of the most divisive issues in the social sciences. Using a newly available data set, this paper develops a simple empirical test that, under plausible (but not innocuous) conditions, provides a lower bound on the extent of discrimination in the labor market. Taken at face value, our estimates imply that differential treatment accounts for at least one-third of the black-white wage gap. We argue that the patterns in our data are most naturally rationalized through a search-matching model in which employers statistically discriminate on the basis of race when hiring unemployed workers but learn about their marginal product over time. [ABSTRACT FROM AUTHOR]

This article studies how decentralization of wage bargaining from sector to firm level influences wage levels and wage dispersion. We use detailed panel data covering a period of decentralization in the Danish labor market. The decentralization process provides variation in the individual worker's wage-setting system that facilitates identification of the effects of decentralization. We find a wage premium associated with firm-level bargaining relative to sector-level bargaining and that the return to skills is higher under the more decentralized wage-setting systems. Using quantile regression, we also find that wages are more dispersed under firm-level bargaining compared to more centralized wage-setting systems. [ABSTRACT FROM AUTHOR]

Using original, representative survey data, we document that analytical, routine, and manual job tasks can be measured with high validity, vary substantially within and between occupations, are significantly related to workers' characteristics, and are robustly predictive of wage differences between occupations and among workers in the same occupation. We offer a conceptual framework that makes explicit the causal links between human capital endowments, occupational assignment, job tasks, and wages, which motivate a Roy model of the allocation of workers to occupations. We offer two simple tests of the model's gross predictions for the relationship between tasks and wages, both of which receive qualified empirical support. [ABSTRACT FROM AUTHOR]

We use Michigan Panel Study of Income Dynamics data and data from a 2008 telephone survey of adults conducted by Westat for the Princeton Data Improvement Initiative (PDII) to explore the importance and feasibility of adding retrospective questions about actual work experience to cross-sectional data sets. We demonstrate that having such actual experience data is important for analyzing women's postschool human capital accumulation, residual wage inequality, and the gender pay gap. Further, our PDII survey results show that it is feasible to collect actual experience data in cross-sectional telephone surveys like the March Current Population Survey's annual supplement. [ABSTRACT FROM AUTHOR]

We show that the reported tendency for performance pay to be associated with greater wage inequality at the top of the earnings distribution applies only to white workers. This results in the white-black wage differential among those in performance pay jobs growing over the earnings distribution even as the same differential shrinks over the distribution for those not in performance pay jobs. We show that this remains true even when examining suitable counterfactuals that hold observables constant between whites and blacks. We explore reasons behind our finding focusing on the interactions between discrimination, unmeasured ability, and selection. [ABSTRACT FROM AUTHOR]

The article discusses labor market segmentation in Brazil by comparing the wages received by workers in the formal and informal sectors of the Brazilian economy. The influence of Brazilian labor laws on labor market rigidity is explained. The presence of market segmentation among specific groups within the Brazilian population is detailed. These different groups are based on age, educational attainment, and income level. The effects of this segmentation on labor mobility in Brazil are detailed as well.

The article applies a longitudinal data set extrapolated from the panel data structure of the Brazilian monthly employment survey known as the Pesquisa Mensal de Emprego (PME) to investigate the degree of segmentation within the Brazilian labor market. The authors use the recorded employment statistics to find the average wage differential between formal and informal workers within the nation. This elucidates a wage gap that this paper speculatively attributes to Brazil’s labor laws. These laws allegedly give rise to two factions: benefited formal workers and informal workers without legal protection or benefits.

The article presents a study reassessing the gender wage gap in Madagascar using a series of first-hand surveys carried out in 1998. It is suggested that gender inequality is likely to be greater when markets do not function efficiently and states lack the resources necessary to introduce corrective policies. Understanding the roots of these gender inequalities will impact policies aimed at reducing gender gaps in developing African countries. Problems concerning labor market attachment for females in developing countries are analyzed. The size of the gender gap in urban Madagascar, the earning determination process across genders, and the implications for gender wage decomposition are evaluated.

The article presents a study seeking to investigate the role labor markets play in the existence and persistence of a gender gap in education in Pakistan. It is suggested that the labor market tends to reward men's schooling more than women's, which creates an incentive for parents to invest more in boys' education than girls. The study also assesses whether the gender gap in earnings and wages can be explained by measurable differences in male and female characteristics. Mincer's semilogarithmic approach is used to estimate private economic returns to schooling attainment. The findings suggest a need for subsidizing higher education for the poor who face credit constraints that prevent them from accessing these educational levels.

We analyze gender wage gaps correcting for sample selection induced by nonemployment. We recover wages for the nonemployed using alternative imputation techniques, simply requiring assumptions on the position of imputed wages with respect to the median. We obtain higher median wage gaps on imputed rather than actual wage distributions for several OECD countries. However, this difference is small in the United States, the United Kingdom, and most central and northern EU countries and becomes sizable in southern EU countries,where gender employment gaps are high. Selection correction explains nearly half of the observed negative correlation between wage and employment gaps. [ABSTRACT FROM AUTHOR]

This article investigates the existence of compensating wage differentials across seasonal and long-term jobs that arise due to anticipated working time restrictions. Using longitudinal information from the Austrian administrative records, we derive a definition of seasonality based on observed regularities in employment patterns. As wages change across seasonal and long-term jobs for the same individual over time, we can control for individual-specific effects and use variation in the starting month of seasonal jobs as an exogenous predictor of anticipated unemployment. We find that employers pay, on average, a positive wage differential of about 11% for seasonal jobs. [ABSTRACT FROM AUTHOR]

The article discusses the effects of various changes to the economic policy and wage differentials in Latin America. The set of policy changes were implemented in the region to foster efficiency in the allocation of resources to achieve higher growth and better functions of economies. The growing wage differentials between less-schooled and more-schooled workers are apparent in a number of emerging economic markets. Furthermore, the theory for the effects of policy changes on differential schooling returns is explored.

This article studies a search model of the labor market in which firms have private information about the quality of their vacancies, they can costlessly communicate with unemployed workers before the beginning of the application process, but the content of the communication does not constitute a contractual obligation. At the end of the application process, wages are determined as the outcome of an alternating offer bargaining game. The model is used to show that vague non-contractual announcements about compensation--such as those one is likely to find in help wanted ads--can be correlated with actual wages and can partially direct the search strategy of workers. [ABSTRACT FROM AUTHOR]

The article presents a study that assesses the effect of capital accumulation on the observed wage gap between skilled and unskilled workers in the manufacturing sector in Argentina. It provides evidence of the relationship between capital accumulation and the wage structure through the variability in wage premia and capital investment across industries in Argentina's manufacturing sector. The authors used repeated cross-sectional data from the Permanent Household Survey between 1991 and 2001, as well as official data on import penetration, exports and investment in machinery and equipment manufacturing sector. Results of the study reveals that in sectors in which capital accumulation has been more intense, the wage gap between skilled and unskilled workers has significantly widened.