Labour market effects of wage inequality and skill-biased technical change in Germany

Arbeitspapier

This paper analyses the relationship between wage inequality and labour market development. Relevant economic theories are ambiguous, just as public debates. We measure the effects of wage inequality, skill-biased and skill-neutral technology on hours worked, productivity and wages in a novel structural vector error correction framework identified by non-recursive long-runrestrictions.Results show that skill-biased technology shocks reduce hours worked but increase inequality, productivity and wages. Structural inequality shocks also have a negative impact on hours worked, but additionally reduce productivity. We find relevant effects of inequality both above and below the median wage.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IAB-Discussion Paper ; No. 5/2017

Classification and Topics

• Classification: Wirtschaft ; Multiple or Simultaneous Equation Models: Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models ; Education and Inequality ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Wage Level and Structure; Wage Differentials
• Subject: inequality ; wages ; productivity ; hours ; SBTC ; SVEC

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hutter, Christian ; Weber, Enzo
• Event: Veröffentlichung
• (who): Institut für Arbeitsmarkt- und Berufsforschung (IAB)
• (where): Nürnberg
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/162476
• Last update: 10.03.2025, 11:44 AM CET