Product market competition, returns to skill and wage inequality
By: by Maria Guadalupe.
Series: Discussion paper ;; no. 1556; Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) ;; no. 1556
Publisher: IZA
Published: 2005
Place of publication: Bonn, Germany
Language: eng
Format: Electronic resource
Subjects: Competition -- Great Britain.; Marketing -- Great Britain.; Wage differentials -- Great Britain.
Description: "This paper shows that increasing product market competition can have a direct impact on the employment relationship and on wage inequality. I develop a simple model in which an increase in product market competition increases returns to skill through the effect of competition on the sensitivity of profits to cost reductions. I then show empirically that relative wages increase with competition using a large panel of United Kingdom workers with complete work histories. I identify the impact of competition on returns to skill in the panel, using two exogenous measures of competition provided by two quasi-natural experiments. Quantile regressions indicate that increased competition also raised returns to unobserved ability"--Forschungsinstitut zur Zukunft der Arbeit web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 4/14/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.