The generation gap: a cohort analysis of earnings levels, dispersion and initial labor market conditions in Italy, 1974-2014

Alfonso Rosolia and Roberto Torrini

No 366, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We discuss entry wages, career patterns and inequality developments of successive cohorts who have entered the Italian labour market between 1974 and 2014. We find that entry wages started to decline around the mid-1990s; the drop continued at least until the onset of the global financial crisis, seemingly slowing down thereafter. This pattern cannot be explained by changes in observable job characteristics. Falling entry wages have not been accompanied by faster subsequent career paths; rather, subsequent career paths have increasingly featured rising earnings dispersion due to both increased workers heterogeneity and greater temporary earnings instability. We relate such developments to the changes in labour market institutions that took place between the early 1990s and the mid-2000s.

Keywords: earnings distribution; cohort effects; labor market reforms; earnings dispersion (search for similar items in EconPapers)
JEL-codes: J31 (search for similar items in EconPapers)
Date: 2016-11
New Economics Papers: this item is included in nep-dem
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:bdi:opques:qef_366_16

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