Skilled and unskilled wage dynamics in Italy in the 1990s: changes in individual characteristics, institutions, trade and technology

Anna Maria Falzoni, Alessandra Venturini and Claudia Villosio

International Review of Applied Economics, 2011, vol. 25, issue 4, 441-463

Abstract: In this paper, we use individual micro data on workers combined with industry and regional data to study the wage dynamics of skilled and unskilled workers in Italy in the 1991-1998 period. In contrast to previous empirical studies, our data make it possible to analyse, within a single framework, the role of many of the factors indicated in the literature as possible determinants of skilled and unskilled wage dynamics: changes in the individual characteristics of workers, changes in labour market institutions, increasing international integration, and skill-biased technological progress. Our results show that international integration, both in terms of trade in goods and in terms of international labour mobility, plays a role in determining the wage dynamics of skilled (white-collar) and unskilled (blue-collar) workers. Moreover, in line with labour economics research, our findings show that the individual characteristics of workers and the institutional variables are more relevant in explaining skilled and unskilled wage dynamics than wage differentials.

Keywords: skilled and unskilled wages; individual characteristics; labour market institutions; international trade (search for similar items in EconPapers)
Date: 2011
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DOI: 10.1080/02692171.2010.529428

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