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Job polarization and structural change

Author

Listed:
  • Christian Siegel

    (University of Exeter)

  • Zsofia Barany

    (Sciences Po)

Abstract

We document that job polarization – contrary to the consensus – has started as early as the 1950s in the US: middle-wage workers have been losing both in terms of employment and average wage growth compared to low- and high-wage workers. Given that polarization is a long-run phenomenon and closely linked to the shift from manufacturing to services, we propose a structural change driven explanation, where we explicitly model the sectoral choice of workers. Our simple model does remarkably well not only in matching the evolution of sectoral employment, but also of relative wages over the past fifty years.

Suggested Citation

  • Christian Siegel & Zsofia Barany, 2016. "Job polarization and structural change," 2016 Meeting Papers 1087, Society for Economic Dynamics.
  • Handle: RePEc:red:sed016:1087
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Vahagn Jerbashian, 2016. "Automation and Job Polarization: On the Decline of Middling Occupations in Europe," UB Economics Working Papers 2016/348, Universitat de Barcelona, Facultat d'Economia i Empresa, UB Economics.
    2. Hemous, David & Olsen, Morten, 2014. "The Rise of the Machines: Automation, Horizontal Innovation and Income Inequality," CEPR Discussion Papers 10244, C.E.P.R. Discussion Papers.
    3. Fabio Cerina & Alessio Moro & Michelle Petersen Rendall, 2016. "The Role of Gender in Employment Polarization," Discussion Papers 1704, Centre for Macroeconomics (CFM), revised Jan 2017.
    4. Barany, Zsofia L. & Siegel, Christian, 2017. "Disentangling Occupation- and Sector-specific Technological Change," Economics Series 331, Institute for Advanced Studies.
    5. Zsófia L. Bárány & Christian Siegel, 2018. "Job Polarization and Structural Change," American Economic Journal: Macroeconomics, American Economic Association, pages 57-89.
    6. Böhm, Michael, 2014. "The Wage Effects of Job Polarization: Evidence from the Allocation of Talents," Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100547, Verein für Socialpolitik / German Economic Association.
    7. Lee, Tim & Shin, Yongseok, 2017. "Horizonatal and Vertical Polarization: Task-Specific Technological Change in a Multi-Sector Economy," TSE Working Papers 17-800, Toulouse School of Economics (TSE).
    8. Yongseok Shin & Tim Lee, 2016. "Managing a Polarized Structural Change," 2016 Meeting Papers 1464, Society for Economic Dynamics.
    9. Wan-Jung Cheng, 2017. "Explaining Job Polarization: The Role of Heterogeneity in Capital Intensity," IEAS Working Paper : academic research 17-A015, Institute of Economics, Academia Sinica, Taipei, Taiwan.
    10. Albertini, Julien & Hairault, Jean-Olivier & Langot, François & Sopraseuth, Thepthida, 2017. "A Tale of Two Countries: A Story of the French and US Polarization," IZA Discussion Papers 11013, Institute for the Study of Labor (IZA).

    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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