Creative Destruction and the Rise of Inequality
AbstractCommon wisdom interprets the rise in inequality of the last two decades as the result of a skill-biased labor demand shift. This explanation does not account for two important observations: (i) within-group inequality has also markedly risen, and (ii) the rise of inequality has been accompanied by a rise of the volatility of earnings. This paper argues that a dual labor market structure, where some workers are paid efficiency-wages can account for the empirical regularities, in the absence of skilled biased technological change. The analysis demonstrates that an unbiased innovation, as well as North-South trade, can contribute to the efficiency wage premium, and thus to wage inequality, by increasing labor turnover. Copyright 2002 by Kluwer Academic Publishers
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Springer in its journal Journal of Economic Growth.
Volume (Year): 7 (2002)
Issue (Month): 3 (September)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=102931
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Diana Weinhold & Usha Nair- Reichert, 2004.
"Innovation, Inequality and Intellectual Property Rights,"
Development and Comp Systems
0410002, EconWPA, revised 04 Nov 2004.
- Weinhold, Diana & Nair-Reichert, Usha, 2009. "Innovation, Inequality and Intellectual Property Rights," World Development, Elsevier, vol. 37(5), pages 889-901, May.
- Vesna Stavrevska, 2011. "The efficiency wages perspective to wage rigidity in the open economy: a survey," International Journal of Manpower, Emerald Group Publishing, vol. 32(3), pages 273-299, July.
- Sandén, Klas, 2007. "Market Imperfections and Wage Inequality," Working Papers in Economics 264, University of Gothenburg, Department of Economics.
- Sandén, Klas, 2007. "Risk, Occupational Choice, and Inequality," Working Papers in Economics 263, University of Gothenburg, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.