Changes in the Distribution of Wages, 1940-1950: The Public vs. the Private Sector
AbstractBetween 1940 and 1950 wage differentials within and between labor market groups narrowed significantly - the so-called 'Great Compression'. This paper disaggregates the Great Compression into its public and private components. Wage compression in the public sector, along with a decline in the pay premia received by public sector workers, explains about 40 percent of aggregate wage compression in the 1940s. The experience of the 1940s stands in stark contrast with that of the past two decades, in which a rigid public sector wage structure has dampened increases in aggregate wage inequality.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5389.
Date of creation: Dec 1995
Date of revision:
Publication status: published as Margo, Robert A. and T. Aldrich Finegan. "The Great Compression Of The 1940s: The Public Versus The Private Sector," Explorations in Economic History, 2002, v39(2,Apr), 183-203.
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Find related papers by JEL classification:
- N32 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: 1913-
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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