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A Longitudinal Analysis of Within-Education-Group Earnings Inequality

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Author Info
Gustavsson, Magnus () (Department of Economics)

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Abstract

Using a large Swedish longitudinal database for the period 1982–2005, I estimate and compare within-group inequality in persistent and transitory earnings among men with high-school and college degrees. Analyses of inequality over the life cycle reveal that experience-variance profiles of persistent earnings are very similar across the two education groups and also consistent with standard human capital models of on-the-job training. Transitory earnings shocks display a marked U-shaped variance pattern over the life-cycle for both groups, but are clearly larger for high-school graduates and also account for a larger proportion of their overall variance. Analyses of changes in within-group inequality over time, holding life-cycle effects constant, show that high-school and college graduates have been subject to similar trend growths in both persistent and transitory earnings differentials between 1982 and 2005.

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File URL: http://www.nek.uu.se/Pdf/wp2008_14.pdf
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Publisher Info
Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number 2008:14.

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Length: 26 pages
Date of creation: 05 Dec 2008
Date of revision:
Handle: RePEc:hhs:uunewp:2008_014

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Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
Phone: + 46 18 471 25 00
Fax: + 46 18 471 14 78
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Web page: http://www.nek.uu.se/
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Related research
Keywords: Permanent inequality; Earnings instability; Life-cycle earnings; Schooling;

Find related papers by JEL classification:
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data
D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
J39 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Other

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This page was last updated on 2009-11-18.

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