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Changes in the Austrian structure of wages, 1996-2002: evidence from linked employer-employee data

Author

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  • Pointner, Wolfgang
  • Stiglbauer, Alfred

Abstract

Analyzing data from the Structure of Earnings Surveys we find that wage dispersion in Austria increased marginally between 1996 and 2002. There was an increase in the returns to education which accrued only to male workers. The positive effects of tenure and especially of experience on wages decreased over time. We adopt the Machado-Mata (2005) counterfactual decomposition technique which allows to attribute changes in each wage decile to changes in worker and workplace characteristics and into changes in returns to these characteristics. Behind the small net increase in inequality we document a number of interesting gross effects that influence the wage distribution. We find that both composition effects due to gender, education and age and market-driven effects such as changes in returns and changing workplace characteristics contributed to a higher dispersion of wages. JEL Classification: J22, J31

Suggested Citation

  • Pointner, Wolfgang & Stiglbauer, Alfred, 2010. "Changes in the Austrian structure of wages, 1996-2002: evidence from linked employer-employee data," Working Paper Series 1268, European Central Bank.
  • Handle: RePEc:ecb:ecbwps:20101268
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    References listed on IDEAS

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    1. Fersterer, Josef & Winter-Ebmer, Rudolf, 2003. "Are Austrian returns to education falling over time?," Labour Economics, Elsevier, vol. 10(1), pages 73-89, February.
    2. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2005. "Rising Wage Inequality: The Role of Composition and Prices," NBER Working Papers 11628, National Bureau of Economic Research, Inc.
    3. Machin, Stephen, 1996. "Wage Inequality in the UK," Oxford Review of Economic Policy, Oxford University Press, vol. 12(1), pages 47-64, Spring.
    4. Thomas Lemieux, 2008. "The changing nature of wage inequality," Journal of Population Economics, Springer;European Society for Population Economics, vol. 21(1), pages 21-48, January.
    5. Thomas Piketty & Emmanuel Saez, 2006. "The Evolution of Top Incomes: A Historical and International Perspective," American Economic Review, American Economic Association, vol. 96(2), pages 200-205, May.
    6. José Mata & José A. F. Machado, 2005. "Counterfactual decomposition of changes in wage distributions using quantile regression," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(4), pages 445-465.
    7. James Albrecht & Anders Bjorklund & Susan Vroman, 2003. "Is There a Glass Ceiling in Sweden?," Journal of Labor Economics, University of Chicago Press, vol. 21(1), pages 145-177, January.
    8. Rebekka Christopoulou & Juan F. Jimeno & Ana Lamo, 2010. "Changes in the wage structure in EU countries," Working Papers 1017, Banco de España;Working Papers Homepage.
    9. Atkinson, A B, 2008. "The Changing Distribution of Earnings in OECD Countries," OUP Catalogue, Oxford University Press, number 9780199532438.
    10. Claudia Goldin & Lawrence F. Katz, 2007. "Long-Run Changes in the U.S. Wage Structure: Narrowing, Widening, Polarizing," NBER Working Papers 13568, National Bureau of Economic Research, Inc.
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    Citations

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    Cited by:

    1. Grandner, Thomas & Gstach, Dieter, 2012. "Decomposing wage discrimination in Germany and Austria with counterfactual densities," Department of Economics Working Paper Series 3614, WU Vienna University of Economics and Business.
    2. René Böheim & Klemens Himpele & Helmut Mahringer & Christine Zulehner, 2011. "The Gender Pay Gap in Austria: Tamensi Movetur!," WIFO Working Papers 394, WIFO.
    3. Thomas Grandner & Dieter Gstach, 2015. "Decomposing wage discrimination in Germany and Austria with counterfactual densities," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 42(1), pages 49-76, February.
    4. repec:wfo:monber:y:2017:i:5:p:425-439 is not listed on IDEAS
    5. René Böheim & Klemens Himpele & Helmut Mahringer & Christine Zulehner, 2013. "The gender wage gap in Austria: eppur si muove!," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 40(4), pages 585-606, November.
    6. repec:wfo:wstudy:60455 is not listed on IDEAS
    7. Böheim, René & Himpele, Klemens & Mahringer, Helmut & Zulehner, Christine, 2013. "The distribution of the gender wage gap in Austria : evidence from matched employer-employee data and tax records," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 46(1), pages 19-34.
    8. Thomas Grandner & Dieter Gstach, 2012. "Decomposing wage discrimination in Germany and Austria with counterfactual densities," Department of Economics Working Papers wuwp145, Vienna University of Economics and Business, Department of Economics.
    9. Florentino Felgueroso & Manuel Hidalgo-Pérez & Sergi Jiménez-Martín, 2016. "The Puzzling Fall of the Wage Skill Premium in Spain," Manchester School, University of Manchester, vol. 84(3), pages 390-435, June.
    10. repec:iab:iabjlr:v:46:i:1:p:19-34 is not listed on IDEAS

    More about this item

    Keywords

    Machado-Mata decomposition; quantile regression; Wage Structure;

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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