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Who lost the most? Distributive effects of COVID-19 pandemic

Carmen Ainaa, Irene Brunetti, Chiara Mussida and Sergio Scicchitano ()

No 829, GLO Discussion Paper Series from Global Labor Organization (GLO)

Abstract: This paper investigates what happened to the wage distribution in Italy during the first wave of the COVID-19 pandemic. It shows which categories of workers and economic sectors have suffered more than others and to what extent both the actual level of smart-working and the ability to Working From-Home can influence the wage distribution. We use a unique dataset relying on the merging of two sample surveys: the Italian Labor Force Survey set up by National Institute of Statistics and the Italian Survey of Professions conducted by the National Institute for Public Policy Analysis. We estimate quantile regression models accounting for selection. First, the findings reveal that the pandemic has affected the wages of the whole workers, but the effect is higher at the bottom of the wage distribution. Second, the actual working from home mitigates the negative distributional consequences of the COVID-19 observed for those at the bottom of the wage distribution. However, the advantage of workers at the bottom tail of the wage distribution seems to lessen in the long term once the health emergency is passed. Third, looking at sectoral heterogeneity, retail and the restaurant are the most hit sectors in terms of wage loss. Fourth, separating by gender, men have been mostly hit by the pandemic, particularly at lowest deciles, though they benefited more from working at home at higher deciles. Finally, women appear as the one that in the long run would benefit more from increasing working from home possibility.

Keywords: Wage inequality; COVID-19; Working from home; Quantile regression (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-cwa, nep-eur and nep-hea
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