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The Dynamics and Inequality of Italian Men’s Earnings: Long-term Changes or Transitory Fluctuations?

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  • Lorenzo Cappellari

Abstract

This paper provides a longitudinal perspective on changes in Italian men’s earnings inequality since the late 1970s by decomposing the earnings autocovariance structure into its long-term and transitory parts. Cross-sectional earnings differentials grew over the period and the longitudinal analysis shows that such growth was determined by the long-term earnings component. Using parameter estimates to analyze low-pay probabilities shows that low-pay persistence and the probability of repeated low-pay episodes grew for all birth cohorts during the early 1990s. Moreover, long-term heterogeneity is found to characterize the earnings distribution of nonmanual workers, accounting for a large part of overall heterogeneity.

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File URL: http://jhr.uwpress.org/cgi/reprint/XXXIX/2/475
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Bibliographic Info

Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

Volume (Year): 39 (2004)
Issue (Month): 2 ()
Pages:

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Handle: RePEc:uwp:jhriss:v:39:y:2004:i:2:p475-499

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Web page: http://jhr.uwpress.org/

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Cited by:
  1. Stephen Jenkins & Peter Lambert, 2011. "Robert Moffitt and Peter Gottschalk’s 1995 paper ‘Trends in the covariance structure of earnings in the US: 1969–1987’," Journal of Economic Inequality, Springer, vol. 9(3), pages 433-437, September.
  2. Paul Bingley & Lorenzo Cappellari & Niels Westergård-Nielsen, 2011. "Flexicurity, Wage Dynamics and Inequality over the Life-Cycle," CESifo Working Paper Series 3561, CESifo Group Munich.
  3. Dahlberg, Matz & Gustavsson, Magnus, 2005. "Inequality and crime: separating the effects of permanent and transitory income," Working Paper Series 2005:19, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  4. Bingley, Paul & Cappellari, Lorenzo & Westergård-Nielsen, Niels C., 2013. "Unemployment Insurance, Wage Dynamics and Inequality over the Life Cycle," IZA Discussion Papers 7128, Institute for the Study of Labor (IZA).
  5. Dimitris Pavlopoulos, 2009. "Starting Your Career with a Temporary Job: Stepping Stone or "Dead-End"?," SOEPpapers on Multidisciplinary Panel Data Research 228, DIW Berlin, The German Socio-Economic Panel (SOEP).
  6. Doris, Aedin & O'Neill, Donal & Sweetman, Olive, 2010. "Identification of the Covariance Structure of Earnings Using the GMM Estimator," IZA Discussion Papers 4952, Institute for the Study of Labor (IZA).
  7. Giesecke, Matthias & Bönke, Timm & Lüthen, Holger, 2011. "The Dynamics of Earnings in Germany: Evidence from Social Security Records," Annual Conference 2011 (Frankfurt, Main): The Order of the World Economy - Lessons from the Crisis 48692, Verein für Socialpolitik / German Economic Association.
  8. Lorenzo Cappellari & Marco Leonardi, 2013. "Earnings Instability and Tenure," CESifo Working Paper Series 4145, CESifo Group Munich.
  9. Adriaan Kalwij & Alessie, R., 2003. "WP 18 - Permanent and transitory wage inequality of British men, 1975-2001: Year, age and cohort effects," AIAS Working Papers wp18, AIAS, Amsterdam Institute for Advanced Labour Studies.
  10. Zhong Zhao, 2010. "Earnings Instability and Earnings Inequality in Urban China: 1989–2006," Working Papers id:2783, eSocialSciences.
  11. Markus Pannenberg & Martin Spiess, 2009. "GEE estimation of the covariance structure of a bivariate panel data model with an application to wage dynamics and the incidence of profit-sharing in West Germany," AStA Advances in Statistical Analysis, Springer, vol. 93(4), pages 427-447, December.

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