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Revisiting the German Wage Structure

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Author Info
Christian Dustmann (University College London.)
Johannes Ludsteck (Institut für Arbeitsmarkt- und Berufsforschung, Nürnberg.)
Uta Schönberg (University College London and Institut für Arbeitsmarkt- und Berufsforschung, Nürnberg.)

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Abstract

This paper shows that wage inequality in West Germany has increased over the past three decades, contrary to common perceptions. During the 1980s, the increase was concentrated at the top of the distribution; in the 1990s, it occurred at the bottom end as well. Our findings are consistent with the view that both in Germany and in the United States, technological change is responsible for the widening of the wage distribution at the top. At the bottom of the wage distribution, the increase in inequality is better explained by episodic events, such as supply shocks and changes in labor market institutions. These events happened a decade later in Germany than in the United States. (c) 2009 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology..

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File URL: http://www.mitpressjournals.org/doi/pdfplus/10.1162/qjec.2009.124.2.843
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Publisher Info
Article provided by MIT Press in its journal Quarterly Journal of Economics.

Volume (Year): 124 (2009)
Issue (Month): 2 (May)
Pages: 843-881
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Handle: RePEc:tpr:qjecon:v:124:y:2009:i:2:p:843-881

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Gernandt, Johannes & Pfeiffer, Friedhelm, 2006. "Rising Wage Inequality in Germany," ZEW Discussion Papers 06-19 [rev.], ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  2. Vona, Francesco & Consoli, Davide, 2009. "Innovation, human capital and earning distribution: towards a dynamic life-cycle approach," MPRA Paper 13032, University Library of Munich, Germany. [Downloadable!]
  3. Carlin, Wendy & Soskice, David, 2007. "Reforms, Macroeconomic Policy and Economic Performance in Germany," CEPR Discussion Papers 6415, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  4. Benjamin Balsmeier & Heiko Peters, 2008. "Family Background or the Characteristics of Children: What Determines High School Success in Germany?," SOEPpapers 138, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
  5. Fitzenberger, Bernd, 2008. "Nach der Reform ist vor der Reform? Eine arbeitsökonomische Analyse ausgewählter Aspekte der Hartz-Reformen," ZEW Discussion Papers 08-011, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  6. Marcus Tamm, 2009. "Child Benefit Reform and Labor Market Participation," Ruhr Economic Papers 0097, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen. [Downloadable!]
  7. Jochen Michaelis & Alexander Spermann, 2009. "Geringqualifizierte Arbeit, Marktlöhne und Sozialpolitik: Konzepte für Deutschland," MAGKS Papers on Economics 200920, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung). [Downloadable!]
  8. Myck, Michal & Ochmann, Richard & Qari, Salmai, 2008. "Dynamics of Earnings and Hourly Wages in Germany," IZA Discussion Papers 3751, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  9. Fitzenberger, Bernd, 2008. "Nach der Reform ist vor der Reform? Eine arbeitsökonomische Analyse ausgewählter Aspekte der Hartz-Reformen," ZEW Discussion Papers 08-011 [rev.], ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  10. Werner Eichhorst, 2007. "Der Arbeitsmarkt in Deutschland: Zwischen Strukturreformen und sozialpolitischem Reflex," IZA Discussion Papers 3194, Institute for the Study of Labor (IZA). [Downloadable!]
  11. Albrecht, James & Björklund, Anders & Vroman, Susan, 2009. "Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000," IZA Discussion Papers 4246, Institute for the Study of Labor (IZA). [Downloadable!]
  12. Entorf, Horst & Tatsi, Eirini, 2009. "Migrants at School: Educational Inequality and Social Interaction in the UK and Germany," IZA Discussion Papers 4175, Institute for the Study of Labor (IZA). [Downloadable!]
  13. Gernandt, Johannes & Pfeiffer, Friedhelm, 2008. "Wage Convergence and Inequality after Unification: (East) Germany in Transition," ZEW Discussion Papers 08-022, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
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  14. Andreas Knabe & Ronnie Schöb, 2008. "Minimum Wage Incidence: The Case for Germany," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  15. Thomas Lemieux, 2008. "The changing nature of wage inequality," Journal of Population Economics, Springer, vol. 21(1), pages 21-48, January. [Downloadable!] (restricted)
    Other versions:
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