Firms and the Decline in Earnings Inequality in Brazil

Author: Mr. Jorge A Alvarez, Felipe Benguria, Niklas Engbom, and Christian Moser

Volume/Issue: Volume 2017 Issue 278

Publication date: December 2017

ISBN: 9781484333037

$20.00

Add to Cart by clicking price of the language and format you'd like to purchase

Available Languages and Formats


English

Prices in red indicate formats that are not yet available but are forthcoming.

Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Labor , Economics- Macroeconomics , Demography , WP , firm effect , firm size , mining firm , pay compression , Earnings Inequality , Linked Employer-Employee Data , Firm and Worker Heterogeneity , Productivity , firm pay policy , productivity shock , characteristics data , inequality trend , firm component , Wages , Income inequality , Aging

Also of interest

WORKING PAPERS PUBLISHED IN APRIL 2004

WORKING PAPERS PUBLISHED IN DECEMBER 2005

WORKING PAPERS PUBLISHED IN DECEMBER 2004

Summary

We document a large decrease in earnings inequality in Brazil between 1996 and 2012. Using administrative linked employer-employee data, we fit high-dimensional worker and firm fixed effects models to understand the sources of this decrease. Firm effects account for 40 percent of the total decrease and worker effects for 29 percent. Changes in observable worker and firm characteristics contributed little to these trends. Instead, the decrease is primarily due to a compression of returns to these characteristics, particularly a declining firm productivity pay premium. Our results shed light on potential drivers of earnings inequality dynamics.