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Wage Inequality in the United Kingdom, 1975-99

Eswar Prasad

No 510, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper uses micro data from the New Earnings Survey to document that cross-sectional wage inequality in the U.K., which rose sharply in the 1980s and continued to rise moderately through the mid-1990s, has remained essentially unchanged in the latter half of the 1990s. As in the U.S., changes in within-group inequality are shown to account for a substantial fraction of the rise in wage dispersion that has occurred over the last 25 years. However, shifts in the structure of employment – including changes in the occupational and industrial composition of aggregate employment – are also shown to have had important effects on the evolution of wage inequality. In addition, there has been a significant convergence of the wage distributions for men and women; this has had a stabilizing effect on the overall wage distribution.

Keywords: micro survey data; cross-sectional wage inequality; between- and within-group inequality; composition effects (search for similar items in EconPapers)
JEL-codes: E24 J31 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2002-06
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published - published in: IMF Staff Papers, 2002, 49 (3), 339-362

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