The evolution of inequality in productivity and wages
Subtitle: panel data evidence
By: Giulia Faggio, Kjell Salvanes, John Van Reenen
Contributors: Salvanes, Kjell; Van Reenen, John; National Bureau of Economic Research
Series: NBER working paper series -- working paper 13351; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13351.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] :
Description: "There has been a remarkable increase in wage inequality in the US, UK and many other countries over the past three decades.  A significant part of this appears to be within observable groups (such as age-gender-skill cells).  A generally untested implication of many theories rationalizing the growth of within-group inequality is that firm-level productivity dispersion should also have increased.  The relevant data for the US is problematic, so we utilize a UK panel dataset covering the manufacturing and non-manufacturing sectors since the early 1980s.  We find evidence that productivity inequality has increased.  Existing studies have underestimated this increased dispersion because they use data from the manufacturing sector which has been in rapid decline.  Most of the increase in individual wage inequality has occurred because of an increase in inequality between firms (and within industries).  Increased productivity dispersion appears to be linked with new technologies as suggested by models such as Caselli (1999) and is not primarily due to an increase in transitory shocks, greater sorting or entry/exit dynamics"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 9/5/2007.

Includes bibliographical references.

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