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Earnings and labour market volatility in Britain, with a transatlantic comparison

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  • Cappellari, Lorenzo
  • Jenkins, Stephen P.

Abstract

We contribute new evidence about earnings and labour market volatility in Britain over the period 1992–2008, for women as well as men, and provide transatlantic comparisons (Most research about volatility refers to earnings volatility for US men.). Earnings volatility declined slightly for both men and women over the period but the changes are not statistically significant. When we look at labour market volatility, i.e. also including individuals with zero earnings in the calculations, there is a statistically significant decline in volatility for both women and men, with the fall greater for men. Using variance decompositions, we demonstrate that the fall in labour market volatility is largely accounted for by changes in employment attachment rates. We show that volatility trends in Britain, and what contributes to them, differ from their US counterparts in several respects.

Suggested Citation

  • Cappellari, Lorenzo & Jenkins, Stephen P., 2014. "Earnings and labour market volatility in Britain, with a transatlantic comparison," LSE Research Online Documents on Economics 57302, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:57302
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    Cited by:

    1. Konstantinos Angelopoulos & Spyridon Lazarakis & Jim Malley, 2019. "Cyclical income risk in Great Britain," CESifo Working Paper Series 7594, CESifo Group Munich.
    2. Konstantinos Angelopoulos & Spyridon Lazarakis & Jim Malley, 2017. "Asymmetries in Earnings, Employment and Wage Risk in Great Britain," CESifo Working Paper Series 6400, CESifo Group Munich.
    3. repec:eee:jcecon:v:46:y:2018:i:2:p:656-682 is not listed on IDEAS
    4. Nelly El-Mallakh & Mathilde Maurel & Biagio Speciale, 2016. "Arab Spring Protests and Women's Labor Market Outcomes: Evidence from the Egyptian Revolution," Working Papers hal-01309651, HAL.
    5. El-Mallakh, Nelly & Maurel, Mathilde & Speciale, Biagio, 2018. "Arab spring protests and women's labor market outcomes: Evidence from the Egyptian revolution," Journal of Comparative Economics, Elsevier, vol. 46(2), pages 656-682.
    6. Richard Hendra & James Riccio & Richard Dorsett & Philip Robins, 2015. "Breaking the low pay, no pay cycle: the effects of the UK Employment Retention and Advancement programme," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-32, December.
    7. Charlotte Bartels & Dirk Neumann, 2018. "Redistribution and Insurance in Welfare States around the World," SOEPpapers on Multidisciplinary Panel Data Research 985, DIW Berlin, The German Socio-Economic Panel (SOEP).
    8. Rémi Bazillier & Jérôme Héricourt & Samuel Ligonnière, 2017. "Structure of Income Inequality and Household Leverage: Theory and Cross-Country Evidence," Working Papers 2017-01, CEPII research center.
    9. Konstantinos Angelopoulos & Spyridon Lazarakis & Jim Malley, 2017. "Asymmetries in Earnings, Employment and Wage Risk in Great Britain," CESifo Working Paper Series 6400, CESifo Group Munich.

    More about this item

    Keywords

    earnings instability; earnings volatility; labour market volatility; SG110858; RES-518-28-001;

    JEL classification:

    • C46 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Specific Distributions
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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