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Workers or Employers: Who Is Shaping Wage Inequality?

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  • Cardoso, Ana Rute

Abstract

An extensive micro data set matching firms, establishments and their employees, is used to study the determinants of earnings inequality in Portugal and its evolution from 1983 to 1992, with the Theil index, its decomposition, and the decomposition of its change as tools of analysis. The relevance of both worker and employer attributes in shaping earnings inequality and its trend is quantified. The impact of the firm on wage inequality in a European country is compared to the situation in the United States, and the results suggest that a more regulated and centralized European bargaining system might reduce the scope for firm action. A profile of an economy undergoing modernization, where rising labor market inequality signaled the lack of an adequate labor force, can be drawn, with the minimum wage having nonetheless a certain narrowing effect on the earnings distributions. Copyright 1997 by Blackwell Publishing Ltd

Suggested Citation

  • Cardoso, Ana Rute, 1997. "Workers or Employers: Who Is Shaping Wage Inequality?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 59(4), pages 523-547, November.
  • Handle: RePEc:bla:obuest:v:59:y:1997:i:4:p:523-47
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    References listed on IDEAS

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    1. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
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    6. Johansen, Søren & Juselius, Katarina, 1992. "Testing structural hypotheses in a multivariate cointegration analysis of the PPP and the UIP for UK," Journal of Econometrics, Elsevier, vol. 53(1-3), pages 211-244.
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    9. Spanos,Aris, 1986. "Statistical Foundations of Econometric Modelling," Cambridge Books, Cambridge University Press, number 9780521269124, March.
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    Cited by:

    1. Pereira, Sonia C., 2003. "The impact of minimum wages on youth employment in Portugal," European Economic Review, Elsevier, vol. 47(2), pages 229-244, April.
    2. Teixeira, Antonio Carlos, 2006. "Transport policies in light of the new economic geography: The Portuguese experience," Regional Science and Urban Economics, Elsevier, vol. 36(4), pages 450-466, July.
    3. David Card & Ana Rute Cardoso & Joerg Heining & Patrick Kline, 2018. "Firms and Labor Market Inequality: Evidence and Some Theory," Journal of Labor Economics, University of Chicago Press, vol. 36(S1), pages 13-70.
    4. David Card & Jörg Heining & Patrick Kline, 2013. "Workplace Heterogeneity and the Rise of West German Wage Inequality," The Quarterly Journal of Economics, Oxford University Press, vol. 128(3), pages 967-1015.
    5. Clementina Santos & Pilar González, 2003. "Gender Wage Differentials in the Portuguese Labor Market," CEF.UP Working Papers 0303, Universidade do Porto, Faculdade de Economia do Porto.
    6. Maria da Conceição Figueiredo & Elsa Fontainha, 2015. "Male and Female Wage Functions: A Quantile Regression Analysis using LEED and LFS Portuguese Databases," Working Papers Department of Economics 2015/01, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    7. Luca David Opromolla, 2013. "Trade and wage inequality," Economic Bulletin and Financial Stability Report Articles, Banco de Portugal, Economics and Research Department.
    8. Tilahun Temesgen, 2006. "Decomposing Gender Wage Differentials in Urban Ethiopia: Evidence from Linked Employer-Employee (LEE) Manufacturing Survey Data," Global Economic Review, Taylor & Francis Journals, vol. 35(1), pages 43-66.
    9. Addison, John T. & Teixeira, Paulino, 1999. "Is Portugal really so arteriosclerotic? Results from a cross-country analysis of labor adjustment," ZEW Discussion Papers 99-30, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    10. Facundo Alvaredo, 2008. "Top incomes and earnings in Portugal 1936-2004," PSE Working Papers halshs-00586795, HAL.

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