Rising Between-workplace Inequalities in High-income Countries

Donald Tomaskovic-Devey*, Anthony Rainey, Dustin Avent-Holt, Nina Bandelj, István Boza, David Cort, Olivier Godechot, Gergely Hajdu, Martin Hällsten, Lasse Folke Henriksen, Are Skeie Hermansen, Feng Hou, Jiwook Jung, Aleksandra Kanjuo-Mrčela, Joe King, Naomi Kodama, Tali Kristal, Alena Krízková, Zoltán Lippényi, Silvia Maja MelzerEunmi Mun, Andrew Penner, Trond Petersen, Andreja Poje, Mirna Safi, Max Thaning, Zaibu Tufail

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

It is well documented that earnings inequalities have risen in many high-income countries. Less clear are the linkages between rising income inequality and workplace dynamics, how within- and between-workplace inequality varies across countries, and to what extent these inequalities are moderated by national labor market institutions. In order to describe changes in the initial between- and within-firm market income distribution we analyze administrative records for 2,000,000,000+ job years nested within 50,000,000+ workplace years for 14 high-income countries in North America, Scandinavia, Continental and Eastern Europe, the Middle East, and East Asia. We find that countries vary a great deal in their levels and trends in earnings inequality but that the between-workplace share of wage inequality is growing in almost all countries examined and is in no country declining. We also find that earnings inequalities and the share of between-workplace inequalities are lower and grew less strongly in countries with stronger institutional employment protections and rose faster when these labor market protections weakened. Our findings suggest that firm-level restructuring and increasing wage inequalities between workplaces are more central contributors to rising income inequality than previously recognized.
Original languageEnglish
JournalProceedings of the National Academy of Sciences of the United States of America
Volume117
Issue number17
Pages (from-to)9277-9283
Number of pages7
ISSN0027-8424
DOIs
Publication statusPublished - 28 Apr 2020

Keywords

  • Administrative data
  • Earnings
  • Inequality
  • Institutions
  • Workplaces

Cite this

Tomaskovic-Devey, D., Rainey, A., Avent-Holt, D., Bandelj, N., Boza, I., Cort, D., Godechot, O., Hajdu, G., Hällsten, M., Henriksen, L. F., Hermansen, A. S., Hou, F., Jung, J., Kanjuo-Mrčela, A., King, J., Kodama, N., Kristal, T., Krízková, A., Lippényi, Z., ... Tufail, Z. (2020). Rising Between-workplace Inequalities in High-income Countries. Proceedings of the National Academy of Sciences of the United States of America, 117(17), 9277-9283. https://doi.org/10.1073/pnas.1918249117