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Wage Inequality and the Changing Organization of Work

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  • Dennis Görlich
  • Dennis Snower

Abstract

This paper sheds light on how changes in the organization of work lead to wage inequality. We present a theoretical model in which workers with a wider span of competence (higher level of multitasking) earn a wage premium. Since abilities and opportunities to expand the span of competence are distributed unequally among workers across and within education groups, our theory explains (1) rising wage inequality between groups, (2) rising wage inequality within groups, and (3) the polarization of work and the decoupling of the income distribution. Using a rich German data set covering a 20-year period from 1986 to 2006, we provide empirical support for our model

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1588.

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Length: 40 pages
Date of creation: Jan 2010
Date of revision:
Handle: RePEc:kie:kieliw:1588

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Keywords: wage inequality; multitasking; tasks; organizational change;

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  1. DiNardo, John E & Pischke, Jorn-Steffen, 1997. "The Returns to Computer Use Revisited: Have Pencils Changed the Wage Structure Too?," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 112(1), pages 291-303, February.
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  5. Lindbeck, Assar & Snower, Dennis J., 1996. "Reorganization of Firms and Labour Market Inequality," CEPR Discussion Papers, C.E.P.R. Discussion Papers 1375, C.E.P.R. Discussion Papers.
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  7. Aghion, Philippe & Howitt, Peter & Violante†, Giovanni L., 2002. "General Purpose Technology and Wage Inequality," Scholarly Articles 12490369, Harvard University Department of Economics.
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  21. Claudia Goldin & Lawrence F. Katz, 2007. "Long-Run Changes in the U.S. Wage Structure: Narrowing, Widening, Polarizing," NBER Working Papers 13568, National Bureau of Economic Research, Inc.
  22. Jorn-Steffen Pischke, 2003. "The Impact of Length of the School Year on Student Performance and Earnings: Evidence from the German Short School Year," NBER Working Papers 9964, National Bureau of Economic Research, Inc.
  23. Lindbeck, Assar & Snower, Dennis J., 1999. "Multi-Task Learning and the Reorganization of Work. From Tayloristic to Holistic Organization," IZA Discussion Papers 39, Institute for the Study of Labor (IZA).
  24. Caroli, Eve & Van Reenen, John, 1999. "Skill biased organizational change? Evidence from a panel of British and French establishments," CEPREMAP Working Papers (Couverture Orange) 9917, CEPREMAP.
  25. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2008. "Trends in U.S. Wage Inequality: Revising the Revisionists," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 300-323, May.
  26. Dieter Von fintel, 2007. "Dealing With Earnings Bracket Responses In Household Surveys - How Sharp Are Midpoint Imputations?," South African Journal of Economics, Economic Society of South Africa, Economic Society of South Africa, vol. 75(2), pages 293-312, 06.
  27. Alexandra Spitz-Oener, 2006. "Technical Change, Job Tasks, and Rising Educational Demands: Looking outside the Wage Structure," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 24(2), pages 235-270, April.
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Cited by:
  1. Kohei Daido & Ken Tabata, 2012. "Skill-Biased Technological Change, Organizational Change, and Wage Inequality," Discussion Paper Series, School of Economics, Kwansei Gakuin University 84, School of Economics, Kwansei Gakuin University, revised Feb 2012.

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