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Wage compression and employment in Europe: First evidence from the structure of earnings survey 2002

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  • Gilles Mourre

Abstract

This paper aims at examining wage compression in Europe using the publicly available data on wages drawn from the Structure of Earnings Survey 2002. By wage compression, it is meant here that the difference in productivity across workers or firms is only partly reflected by the difference in wages. The paper specifically considers the existence of wage compression both across occupations and levels of education by means of cross-sectional econometric analysis. Looking at wage compression across occupations, robust evidence gives some support to the conventional view that there is a compressed wage distribution in Europe. Wage compression mainly occurs in continental and southern countries, whilst no compression is detected in Anglo-Saxon countries and mixed evidence is found in Northern European countries.

Suggested Citation

  • Gilles Mourre, 2005. "Wage compression and employment in Europe: First evidence from the structure of earnings survey 2002," European Economy - Economic Papers 2008 - 2015 232, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
  • Handle: RePEc:euf:ecopap:0232
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    References listed on IDEAS

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    Cited by:

    1. Bernard Gazier, 2007. "“Making transitions pay” : The “Transitional labour markets” approach to “Flexicurity"," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00186363, HAL.
    2. John Hassler & José Rodríguez Mora & Joseph Zeira, 2007. "Inequality and mobility," Journal of Economic Growth, Springer, vol. 12(3), pages 235-259, September.
    3. Michel Dumont, 2008. "Working Paper 22-08 - Wages and employment by level of education and occupation in Belgium," Working Papers 0822, Federal Planning Bureau, Belgium.
    4. Luis Santos-Pinto, 2011. "Labor Market Signaling and Self-Confidence: Wage Compression and the Gender Pay Gap N.B.: This paper replaces Nr 10.07 "Labor Market Signaling with Overconfident Workers" (June 2010)," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 11.07, Université de Lausanne, Faculté des HEC, DEEP.

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