Wage Dispersion, Over-Qualification, and Reder Competition
AbstractThe expansion of higher education in the Western countries has been accompanied by a marked widening of wage differentials and increasing over-qualification. While the increase in wage differentials has been attributed to skill-biased technological change that made advanced skills scarce, this explanation does not fit well with the observed increase in over-qualification which suggests that advanced skills are in excess supply. By "Reder-competition" I refer to the simultaneous adjustment of wage offers and hiring standards in response to changing labor market conditions. I present a simple model of Reder competition that depicts wages as driven by labor heterogeneity, rather than scarcity. The mechanism may give rise to a simultaneous increase in wage differentials and over-qualification. --
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Bibliographic InfoArticle provided by Kiel Institute for the World Economy in its journal Economics: The Open-Access, Open-Assessment E-Journal.
Volume (Year): 1 (2007)
Issue (Month): 13 (Version 2) ()
Hiring standards; employment criteria; selection wages; efficiency wages; mobility; skillbiased technological change; heterogeneity-biased technological change; over-qualification; over-education; wage dispersion; Reder competition;
Other versions of this item:
- Schlicht, Ekkehart, 2007. "Wage Dispersion, Over-Qualification, and Reder Competition," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 1(13), pages 1-31.
- Schlicht, Ekkehart, 2007. "Wage Dispersion and Overqualification as Entailed by Reder Competition," Discussion Papers in Economics 1976, University of Munich, Department of Economics.
- Schlicht, Ekkehart, 2007. "Wage Dispersion and Overqualification as Entailed by Reder Competition," Economics Discussion Papers 2007-22, Kiel Institute for the World Economy.
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Krugman und der Mindestlohn
by Ekkehart Schlicht in Funktionale Staatsfinanzen on 2013-02-18 16:42:00
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