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Asymmetries in Earnings, Employment and Wage Risk in Great Britain

Author

Listed:
  • Spyridon Lazarakis

    (University of Glasgow)

  • James Malley

    (University of Glasgow and CESifo)

  • Konstantinos Angelopoulos

    (University of Glasgow)

Abstract

This paper examines the relationship between idiosyncratic earnings, employment and wage risk and fluctuations in aggregate labour market quantities for Great Britain. We use data from the British Household Panel Survey(BHPS) for 1991-2008 and from the BHPS sub-sample of Understanding Society for 2010-2014. We measure idiosyncratic risk by the relevant moments of the distribution of earnings, employment and wage shocks across individuals. Our main finding is that each of these measures of idiosyncratic labour income risk responds symmetrically to fluctuations in the labour market aggregates. Furthermore, we find evidence of insurance, both within the household and in the form of public insurance. However, household disposable income risk still increases with negative changes in mean earnings, implying that private and public of insurance do not eliminate the increase in risk.

Suggested Citation

  • Spyridon Lazarakis & James Malley & Konstantinos Angelopoulos, 2017. "Asymmetries in Earnings, Employment and Wage Risk in Great Britain," 2017 Meeting Papers 1314, Society for Economic Dynamics.
  • Handle: RePEc:red:sed017:1314
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    References listed on IDEAS

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    Cited by:

    1. Konstantinos Angelopoulos & Spyridon Lazarakis & Jim Malley, 2017. "Wealth Inequality and Externalities from Ex Ante Skill Heterogeneity," CESifo Working Paper Series 6572, CESifo Group Munich.

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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