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Changes in the German Wage Structure: Unions, Internationalization, Tasks, Firms, and Worker Characteristics

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  • Biewen, Martin

    () (University of Tuebingen)

  • Seckler, Matthias

    () (University of Tübingen)

Abstract

This paper provides a comprehensive assessment of the quantitative importance of the factors associated with the rise in male wage inequality in Germany over the period 1995–2010. In contrast to most previous contributions, we rely on the German Structure of Earnings Surveys (GSES) which allow us to focus on hourly wages (rather than daily earnings) uncensored by the social security contributions threshold. We consider a large number of covariates including personal characteristics, measures of internationalization, task composition, union coverage, industry, region, and firm characteristics. Our results suggest that recent changes in the distribution of hourly wages in Germany look different from the polarizing patterns found for the US, and that most of the observed rise in inequality was associated with compositional effects of de-unionization and personal characteristics. We also find some moderate effects linked to internationalization, firm heterogeneity and regional convergence, but these were much smaller.

Suggested Citation

  • Biewen, Martin & Seckler, Matthias, 2017. "Changes in the German Wage Structure: Unions, Internationalization, Tasks, Firms, and Worker Characteristics," IZA Discussion Papers 10763, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10763
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    References listed on IDEAS

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    Cited by:

    1. Boris Hirsch & Steffen Müller, 2018. "Firm Wage Premia, Industrial Relations, and Rent Sharing in Germany," CESifo Working Paper Series 6890, CESifo Group Munich.
    2. repec:gam:jecnmx:v:6:y:2018:i:2:p:20-:d:140515 is not listed on IDEAS
    3. Dirk Antonczyk & Thomas DeLeire & Bernd Fitzenberger, 2018. "Polarization and Rising Wage Inequality: Comparing the U.S. and Germany," Econometrics, MDPI, Open Access Journal, vol. 6(2), pages 1-33, April.

    More about this item

    Keywords

    RIF regression; reweighting; skill-biased technical change; de-unionization;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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