Structural Change and Inter-Industry Wage Differentiation

Vladimir Gimpelson

Journal of the New Economic Association, 2016, vol. 31, issue 3, 186-197

Abstract: The paper discusses how industrial division of the Russian economy affected wage inequality in the beginning of XXI century. This impact depended on the industrial composition of employment, industrial wage premiums, and intra-industry wage differentiation. Calculations based on various Rosstat data sources suggest that all three factors contributed to the narrowing of wage inequality. Proportion of employment in the highest and lowest paying industies tended to shrink, compressing the wage distribution from the both tales. Wages in these industries approached the averages for the whole economy. At the same time, the intra-industry wage differentiation measured by Gini coefficients contracted as well. Observed dynamics in cross-industrial inequality can survive in medium term perspective. Lower hydrocarbon prices are likely to affect negatively the wage paying capacity of firms in this sector, thus compressing relative wages. The same can happen in the crisisridden financial sector. If upward pressures on wages in the budgetary sector do not disappear, relative wages here will grow bringing an equalizing effect on the total wage distribution.

Keywords: wages; inequality; cross-industry differentiation (search for similar items in EconPapers)
JEL-codes: J21 J31 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:nea:journl:y:2016:i:31:p:186-197

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