Wage Dispersion over the Business Cycle

Annaïg  Morin

doi:10.1016/j.econlet.2019.04.013

Wage Dispersion over the Business Cycle

Annaïg Morin

Department of Economics

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Abstract

In this paper, I provide robust evidence that fluctuations in wage dispersion are independent of the business cycle, while residual wage dispersion, i.e. dispersion of wages within narrowly defined demographic and skill groups of workers, increases during booms and lessens during recessions. Moreover, I show that the procyclical fluctuations in residual wage dispersion are mainly generated by cyclical changes in the upper half of the residual wage distribution.

Original language	English
Journal	Economics Letters
Volume	181
Pages (from-to)	17-21
Number of pages	5
ISSN	0165-1765
DOIs	https://doi.org/10.1016/j.econlet.2019.04.013
Publication status	Published - Aug 2019

Keywords

Wage dispersion
Business cycles

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AB - In this paper, I provide robust evidence that fluctuations in wage dispersion are independent of the business cycle, while residual wage dispersion, i.e. dispersion of wages within narrowly defined demographic and skill groups of workers, increases during booms and lessens during recessions. Moreover, I show that the procyclical fluctuations in residual wage dispersion are mainly generated by cyclical changes in the upper half of the residual wage distribution.

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KW - Business cycles

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DO - 10.1016/j.econlet.2019.04.013

M3 - Journal article

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