Job polarization and structural change

Zsófia L. Bárány, Christian Siegel

Research output: Contribution to journalArticlepeer-review

Abstract (may include machine translation)

We document that job polarization-contrary to the consensus- has started as early as the 1950s in the United States: middle-wage workers have been losing both in terms of employment and average wage growth compared to low- and high-wage workers. Given that polarization is a long-run phenomenon and closely linked to the shift from manufacturing to services, we propose a structural change driven explanation, where we explicitly model the sectoral choice of workers. Our simple model does remarkably well not only in matching the evolution of sectoral employment, but also of relative wages over the past 50 years.

Original languageEnglish
Pages (from-to)57-89
Number of pages33
JournalAmerican Economic Journal: Macroeconomics
Volume10
Issue number1
DOIs
StatePublished - 1 Jan 2018
Externally publishedYes

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