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Structural Change and Inter-Industry Wage Differentiation

Author

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  • Gimpelson, V.

    (National Research University Higher School of Economics, Moscow, Russia)

Abstract

The paper discusses how industrial division of the Russian economy affected wage inequality in the beginning of XXI century. This impact depended on the industrial composition of employment, industrial wage premiums, and intra-industry wage differentiation. Calculations based on various Rosstat data sources suggest that all three factors contributed to the narrowing of wage inequality. Proportion of employment in the highest and lowest paying industies tended to shrink, compressing the wage distribution from the both tales. Wages in these industries approached the averages for the whole economy. At the same time, the intra-industry wage differentiation measured by Gini coefficients contracted as well. Observed dynamics in cross-industrial inequality can survive in medium term perspective. Lower hydrocarbon prices are likely to affect negatively the wage paying capacity of firms in this sector, thus compressing relative wages. The same can happen in the crisisridden financial sector. If upward pressures on wages in the budgetary sector do not disappear, relative wages here will grow bringing an equalizing effect on the total wage distribution.

Suggested Citation

  • Gimpelson, V., 2016. "Structural Change and Inter-Industry Wage Differentiation," Journal of the New Economic Association, New Economic Association, vol. 31(3), pages 186-197.
    • Handle: RePEc:nea:journl:y:2016:i:31:p:186-197
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    References listed on IDEAS

    as
    1. Lambert, Peter J & Aronson, J Richard, 1993. "Inequality Decomposition Analysis and the Gini Coefficient Revisited," Economic Journal, Royal Economic Society, vol. 103(420), pages 1221-1227, September.
    2. Gimpelson, Vladimir & Kapeliushnikov, Rostislav, 2011. "Labor Market Adjustment: Is Russia Different?," IZA Discussion Papers 5588, Institute of Labor Economics (IZA).
    3. Lerman, Robert I & Yitzhaki, Shlomo, 1985. "Income Inequality Effects by Income," The Review of Economics and Statistics, MIT Press, vol. 67(1), pages 151-156, February.
    4. Shorrocks, A F, 1982. "Inequality Decomposition by Factor Components," Econometrica, Econometric Society, vol. 50(1), pages 193-211, January.
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    Cited by:

    1. Vladimir Hlasny, 2022. "Household Earnings in Putin’s Russia: Distributional Changes across Socioeconomic Groups, 2000–2016," LIS Working papers 847, LIS Cross-National Data Center in Luxembourg.
    2. Marina Malkina, 2019. "Spatial wage inequality and its sectoral determinants: the case of modern Russia," Oeconomia Copernicana, Institute of Economic Research, vol. 10(1), pages 69-87, March.
    3. Vladimir Gimpelson, 2019. "The labor market in Russia, 2000–2017," IZA World of Labor, Institute of Labor Economics (IZA), pages 466-466, September.

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    More about this item

    Keywords

    wages; inequality; cross-industry differentiation;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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