Educational Self-Selection, Tasks Assignment and Rising Wage Inequality
نویسنده
چکیده
Educational Self-Selection, Tasks Assignment and Rising Wage Inequality This paper presents a general equilibrium assignment model of workers to tasks with endogenous human capital formation and multidimensionality of skills. The model has 2 key features. First, skills are endogenous and multidimensional. Second, two types of assignment occur, workers self-select their education and firms assign workers to tasks/machines. This assignment model yields two functions mapping skills of each type to tasks. Equilibrium is characterized by different wage functions for each type of skills, so that the wage distributions generally overlap. This model offers a unique framework to analyze changes in the wage structure within and between skills groups of workers and distinguishes between technological change that is related to machines (the technical factor) or related to workers (the human factor). I show both theoretically and through simulations that the model can reproduce simultaneously i) the overlap in the wage distributions of college and high-school graduates, ii) the rise in the college-premium, iii) the rise in within wage inequality iv) the differential behavior of the between and within wage inequality in the 60s and 70s and, v) the decline of the wage at the first decile of the overall wage distribution. A family of closed form solutions for the wage functions is proposed. In this family, the output of worker-task pairs is Cobb-Douglas, tasks are distributed according to a Beta distribution and the mapping functions have a logistic form. JEL Classification: D3, J21, J23, J31
منابع مشابه
Estimating the Causal Effects of Education on Wage Inequality Using IV Methods and Sample Selection Models
We develop semiparametric and instrumental-variables approaches to self-selection problems in comparisons of wage inequality between educational groups. We propose new estimators to identify the causal effect of college education on scale parameters of wage distributions, using symmetry conditions on the joint distribution of outcome and selection errors, along with kernel weighting schemes. A ...
متن کاملNon-Routine Tasks, Restructuring of Firms, and Wage Inequality Within and Between Skill-Groups∗
This paper argues that endogenous restructuring processes within firms towards analytical and interactive non-routine tasks (like problem-solving and organizational activities, respectively), triggered by advances in information and communication technologies (ICT) and rising supply of educated workers, are associated with an increase of wage inequality within education groups. We show that thi...
متن کاملWorkplace Heterogeneity and the Rise of West German Wage Inequality
We study the role of establishment-specific wage premiums in generating recent increases in West German wage inequality. Models with additive fixed effects for workers and establishments are fit in four sub-intervals spanning the period from 1985 to 2009. We show that these models provide a good approximation to the wage structure and can explain nearly all of the dramatic rise in West German w...
متن کاملThe Polarization of the U.S. Labor Market
Much research (surveyed in Katz and Autor, 1999) documents a substantial widening of the U.S. wage structure since the late 1970s, driven by increases in educational wage differentials and residual wage inequality. The growth in wage inequality was most rapid during the 1980s, and involved a spreading out of the entire wage distribution. Rapid secular growth in the demand for skills, partly fro...
متن کاملThe Macroeconomic Implications of Rising Wage Inequality in the United States
In recent decades, American workers have faced a rising college premium, a narrowing gender gap, and increasing wage volatility. This paper explores the quantitative and welfare implications of these changes. The framework is an incomplete-markets life cycle model in which individuals choose education, intrafamily time allocation, and savings. Given the observed history of the U.S. wage structu...
متن کامل