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Wage mobility in Austria 1986-1996

  • Hofer, Helmut
  • Weber, Andrea

We examine wage mobility of Austrians, using 1986-1996 data from administrative sources. For the evaluation of wage mobility we calculate mobility measures based on transitions between quintiles in the wage distribution. A second group of indices measure wage mobility by the extent to which averaging wages over a longer period decreases cross sectional inequality. We find that mobility reduces wage inequality by 7 per cent over a six-year period. This equalising effect of wage mobility is only half as large as in other OECD countries. Considering an 11 year horizon for Austria implies a reduction of inequality of 10 per cent. Mobility is high only for young workers and for workers who changed their employer at least once during the observation period. Decomposing the sample into sex, age and worker-type groups and comparing within- and between-group mobility shows that most of the equalising effect of mobility occurs within the groups.

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Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 9 (2002)
Issue (Month): 4 (September)
Pages: 563-577

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Handle: RePEc:eee:labeco:v:9:y:2002:i:4:p:563-577
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  1. Aaberge, Rolf & Björklund, Anders & Jäntti, Markus & Palme, Mårten & Pedersen, Peder & Smith, Nina & Wennemo, Tom, 1996. "Income Inequality and Income Mobility in the Scandinavian Countries Compared to the United States," SSE/EFI Working Paper Series in Economics and Finance 98, Stockholm School of Economics, revised Aug 2002.
  2. Geweke, John & Marshall, Robert C & Zarkin, Gary A, 1986. "Mobility Indices in Continuous Time Markov Chains," Econometrica, Econometric Society, vol. 54(6), pages 1407-23, November.
  3. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-81, September.
  4. Shorrocks, Anthony, 1978. "Income inequality and income mobility," Journal of Economic Theory, Elsevier, vol. 19(2), pages 376-393, December.
  5. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-25, April.
  6. Machin, Stephen, 1996. "Wage Inequality in the UK," Oxford Review of Economic Policy, Oxford University Press, vol. 12(1), pages 47-64, Spring.
  7. repec:sae:niesru:v:166:y::i:1:p:87-96 is not listed on IDEAS
  8. Michael F. Förster, 2000. "Trends and Driving Factors in Income Distribution and Poverty in the OECD Area," OECD Labour Market and Social Policy Occasional Papers 42, OECD Publishing.
  9. Beblo, Miriam & Knaus, Thomas, 2000. "Measuring Income Inequality in Euroland," IRISS Working Paper Series 2000-10, IRISS at CEPS/INSTEAD.
  10. Fuess, Jr., Scott M. & Millea, Meghan, 2001. "Pay and Productivity in a Corporatist Economy: Evidence from Austria," IZA Discussion Papers 244, Institute for the Study of Labor (IZA).
  11. Moshe Buchinsky & Jennifer Hunt, 1996. "Wage Mobility in the United States," NBER Working Papers 5455, National Bureau of Economic Research, Inc.
  12. repec:cup:cbooks:9780521590730 is not listed on IDEAS
  13. Helmut Hofer & Karl Pichelmann & Andreas-Ulrich Schuh, 2001. "Price and quantity adjustments in the Austrian labour market," Applied Economics, Taylor & Francis Journals, vol. 33(5), pages 581-592.
  14. Frank Cowell & Christian Schluter, 1998. "Income mobility : a robust approach," LSE Research Online Documents on Economics 2210, London School of Economics and Political Science, LSE Library.
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