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Policy, Institutional Factors and Earnings Mobility

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Author Info
Sologon, Denisa Maria () (Maastricht University)
O'Donoghue, Cathal () (Teagasc Rural Economy Research Centre)

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Abstract

This paper uses ECHP and OECD data for 14 EU countries to explore the role of labour market factors in explaining cross-national differences in the dynamic structure of earnings: in permanent inequality, transitory inequality and earnings mobility. Based on ECHP, minimum distance estimator is used to decompose earnings inequality into the permanent and transitory components and compute earnings mobility. The predicted components together with the institutional OECD data are used in a non-linear least squares setting to estimate the relationship between permanent inequality, transitory inequality and earnings mobility, and labour market policy and institutional factors. The results revealed a highly complex framework, where institutions interact significantly not only with each other and with the overall institutional setting, but also with the macroeconomic shocks in shaping the pattern of the three labour market outcomes.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4151.

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Length: 108 pages
Date of creation: Apr 2009
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Handle: RePEc:iza:izadps:dp4151

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Related research
Keywords: panel data; wage distribution; inequality; mobility; labour market institutions; labour market policies;

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Find related papers by JEL classification:
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J60 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - General
J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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This page was last updated on 2009-11-23.

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