Establishment Turnover and the Evolution of Wage Inequality

Anabela Carneiro and Jose Varejao ()

CEF.UP Working Papers from Universidade do Porto, Faculdade de Economia do Porto

Abstract: We consider the determinants of the evolution of wage inequality in the context of the literature on entry and exit of establishments. Using several measures of wage inequality (overall, within-group, and between-groups), we conclude that shutdowns reduce overall and within-group inequality because they eliminate low-pay jobs. Startups increase wage inequality between age and, especially, education groups, because newly-created establishments make staffing choices that are different from those made by continuously-operating establishments and establishments that shut down.

Keywords: Wage Inequality; Labor Demand; Establishment Turnover. (search for similar items in EconPapers)
JEL-codes: J23 J31 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2012-05
New Economics Papers: this item is included in nep-lab, nep-lma and nep-ltv
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Persistent link: https://EconPapers.repec.org/RePEc:por:cetedp:1202

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