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Wage inequality and skill asymmetries Author info | Abstract | Publisher info | Download info | Related research | Statistics Peter Skott (University of Aarhus)
Paul Auerbach
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Using a simple model with two levels of skill, we assume that high-skill workers who fail to get high-skill jobs may accept low-skill positions; low-skill workers do not have the analogous option of filling high-skill positions. This asymmetry implies that an adverse, skill-neutral shock to aggregate employment may cause an increase in wage inequality, both between and within skill categories, as well as an increase in unemployment, especially among low-skill workers. Movements in productivity, unemployment and inequality may thus be linked to induced overeducation and credentialism.
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Paper provided by University of Massachusetts Amherst, Department of Economics in its series Working Papers with number
2004-03.
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Date of creation: 2004Date of revision:
Handle: RePEc:ums:papers:2004-03Contact details of provider: Postal: Thompson Hall, Amherst, MA 01003 Phone: (413)545-2590 Fax: (413)545-2921 Email: Web page: http://www.umass.edu/economics More information through EDIRC
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Keywords: wage inequality ; unemployment ; skill-bias ; overeducation ; Other versions of this item:
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Peter Skott, 2005.
"Wage inequality and overeducation in a model with efficiency wages ,"
Working Papers
2005-06, University of Massachusetts Amherst, Department of Economics.
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"Power-Biased Technological Change and the Rise in Earnings Inequality ,"
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06, ECINEQ, Society for the Study of Economic Inequality.
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