Sector heterogeneity and wage inequality

Jiancai Pi and Yanwei Fan

Asia-Pacific Journal of Accounting & Economics, 2021, vol. 28, issue 6, 657-673

Abstract: This paper takes heterogeneity between different skilled sectors into account and analyzes how sector heterogeneity affects wage inequality through the general equilibrium approach. We find that under both the wage efficiency hypothesis and the fair wage hypothesis, an increase in the degree of sector heterogeneity will conditionally expand wage inequality between skilled workers in the high-productivity skilled sector and the low-productivity skilled sector and that between skilled and unskilled labor.

Date: 2021
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DOI: 10.1080/16081625.2019.1673187

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Asia-Pacific Journal of Accounting & Economics is currently edited by Yin-Wong Cheung, Hong Hwang, Jeong-Bon Kim, Shu-Hsing Li and Suresh Radhakrishnan

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