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Wage Inequality in the United Kingdom, 1975-99

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Author Info
Prasad, Eswar S. () (International Monetary Fund and IZA Bonn)

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Abstract

This paper uses micro data from the New Earnings Survey to document that cross-sectional wage inequality in the U.K., which rose sharply in the 1980s and continued to rise moderately through the mid-1990s, has remained essentially unchanged in the latter half of the 1990s. As in the U.S., changes in within-group inequality are shown to account for a substantial fraction of the rise in wage dispersion that has occurred over the last 25 years. However, shifts in the structure of employment – including changes in the occupational and industrial composition of aggregate employment – are also shown to have had important effects on the evolution of wage inequality. In addition, there has been a significant convergence of the wage distributions for men and women; this has had a stabilizing effect on the overall wage distribution.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 510.

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Length: 33 pages
Date of creation: Jun 2002
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Handle: RePEc:iza:izadps:dp510

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Related research
Keywords: cross-sectional wage inequality; micro survey data; between- and within-group inequality; composition effects;

Other versions of this item:

Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution

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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.:
  1. Aghion, Philippe & Howitt, Peter & Violante, Giovanni L, 2000. "General Purpose Technology and Within-Group Inequality," CEPR Discussion Papers 2474, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  2. Nicole M. Fortin & Thomas Lemieux, 2000. "Are Women's Wage Gains Men's Losses? A Distributional Test," American Economic Review, American Economic Association, vol. 90(2), pages 456-460, May. [Downloadable!] (restricted)
  3. Stephen Machin & John Van Reenen, 1998. "Technology And Changes In Skill Structure: Evidence From Seven Oecd Countries," The Quarterly Journal of Economics, MIT Press, vol. 113(4), pages 1215-1244, November. [Downloadable!] (restricted)
    Other versions:
  4. Dickens, Richard, 2000. "The Evolution of Individual Male Earnings in Great Britain: 1975-95," Economic Journal, Royal Economic Society, vol. 110(460), pages 27-49, January. [Downloadable!] (restricted)
  5. Eswar Prasad, 2000. "The Unbearable Stability of the German Wage Structure - Evidence and Interpretation," IMF Working Papers 00/22, International Monetary Fund.
    Other versions:
  6. Oded Galor & Omer Moav, 1998. "Ability Biased Technological Transition, Wage Inequality, and Economic Growth," Working Papers 98-14, Brown University, Department of Economics.
    Other versions:
  7. Siebert, Horst, 1997. "Labor Market Rigidities: At the Root of Unemployment in Europe," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 37-54, Summer. [Downloadable!] (restricted)
  8. Krugman, Paul R., 2000. "Technology, trade and factor prices," Journal of International Economics, Elsevier, vol. 50(1), pages 51-71, February. [Downloadable!] (restricted)
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  9. Paul Gregg & Steve Machin, . "Is the UK rise in inequality different?," NIESR Discussion Papers 45, National Institute of Economic and Social Research.
  10. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June. [Downloadable!] (restricted)
  11. Peter Gottschalk & Timothy M. Smeeding, 1997. "Cross-National Comparisons of Earnings and Income Inequality," Journal of Economic Literature, American Economic Association, vol. 35(2), pages 633-687, June. [Downloadable!] (restricted)
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