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International Differences in Male Wage Inequality: Institutions versus Market Forces

  • Blau, Francine D
  • Kahn, Lawrence M

This paper studies the considerably higher level of wage inequality in the United States than in nine other OECD countries. The authors find that the greater overall U.S. wage dispersion primarily reflects substantially more compression at the bottom of the wage distribution in the other countries. While differences in the distribution of measured characteristics help to explain some aspects of the international differences, higher U.S. prices (i.e., rewards to skills and rents) are an important factor. Labor market institutions, chiefly the relatively decentralized wage-setting mechanisms in the United States, provide the most persuasive explanation for these patterns. Copyright 1996 by University of Chicago Press.

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File URL: http://dx.doi.org/10.1086/262043
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Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 104 (1996)
Issue (Month): 4 (August)
Pages: 791-836

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Handle: RePEc:ucp:jpolec:v:104:y:1996:i:4:p:791-836
Contact details of provider: Web page: http://www.journals.uchicago.edu/JPE/

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  1. Erica L. Groshen, 1991. "The Structure of the Female/Male Wage Differential: Is It Who You Are, What You Do, or Where You Work?," Journal of Human Resources, University of Wisconsin Press, vol. 26(3), pages 457-472.
  2. Barry P. Bosworth & Robert Z. Lawrence, 1988. "Managing Macroeconomic Imbalances," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(5), pages 1006-1012.
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  4. Anders Bjorklund & Richard B. Freeman, 1994. "Generating Equality and Eliminating Poverty, The Swedish Way," NBER Working Papers 4945, National Bureau of Economic Research, Inc.
  5. Krueger, Alan B & Summers, Lawrence H, 1988. "Efficiency Wages and the Inter-industry Wage Structure," Econometrica, Econometric Society, vol. 56(2), pages 259-93, March.
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  8. anonymous, 1988. "Economic notes," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 51, december.
  9. Kahn, Lawrence M & Curme, Michael, 1987. "Unions and Nonunion Wage Dispersion," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 600-607, November.
  10. Blau, Francine D & Kahn, Lawrence M, 1992. "The Gender Earnings Gap: Learning from International Comparisons," American Economic Review, American Economic Association, vol. 82(2), pages 533-38, May.
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  13. David Neumark & William Wascher, 1992. "Employment Effects of Minimum and Subminimum Wages: Panel Data on State Minimum Wage Laws," ILR Review, Cornell University, ILR School, vol. 46(1), pages 55-81, October.
  14. -, 1988. "Evolución de la economía brasileña," Informe Estadístico – Oficina de la CEPAL en Brasilia 28036, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
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  17. Steven J. Davis, 1992. "Cross-Country Patterns of Change in Relative Wages," NBER Working Papers 4085, National Bureau of Economic Research, Inc.
  18. Bound, John & Johnson, George, 1992. "Changes in the Structure of Wages in the 1980's: An Evaluation of Alternative Explanations," American Economic Review, American Economic Association, vol. 82(3), pages 371-92, June.
  19. Richard B. Freeman, 1980. "Unionism and the Dispersion of Wages," ILR Review, Cornell University, ILR School, vol. 34(1), pages 3-23, October.
  20. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
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  24. Michael Bruno & Jeffrey D. Sachs, 1985. "Economics of Worldwide Stagflation," NBER Books, National Bureau of Economic Research, Inc, number brun85-1, September.
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  27. Wallace E. Hendricks & Lawrence M. Kahn, 1982. "The Determinants of Bargaining Structure in U.S. Manufacturing Industries," ILR Review, Cornell University, ILR School, vol. 35(2), pages 181-195, January.
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  29. Dora L. Costa & Matthew E. Kahn, 2008. "Learning from the Past," NBER Chapters, in: Heroes and Cowards: The Social Face of War National Bureau of Economic Research, Inc.
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  31. Chinhui Juhn, 1992. "Decline of Male Labor Market Participation: The Role of Declining Market Opportunities," The Quarterly Journal of Economics, Oxford University Press, vol. 107(1), pages 79-121.
  32. Harry C. Katz, 1993. "The Decentralization of Collective Bargaining: A Literature Review and Comparative Analysis," ILR Review, Cornell University, ILR School, vol. 47(1), pages 3-22, October.
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  34. Jamal V., 1988. "Somalia: economics for an unconventional economy," ILO Working Papers 992587833402676, International Labour Organization.
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