Wage distributions

The Brazilian labor market experienced a host of positive developments between 2001 and 2015. Inequality fell, as average schooling levels, labor earnings, and formal contract hiring substantially increased. Despite this period of progress, which is now threatened by an ongoing fiscal crisis, the Brazilian labor market has much to improve upon, particularly with respect to informality and the gender and ethnic earnings gaps. Key policy initiatives for the future should include improving the quality of education, reducing the administrative burden of hiring formal workers, and further opening the country to international trade. Monthly earnings and inequality in Brazil (workers aged 16-64) From 2001 to 2015, Brazil experienced a profound reduction in income inequality. The commodities boom and some institutional changes in the early 2000s kickstarted the Brazilian labor market, increasing the quantity of formal jobs and earnings, especially for the poorest workers. Significant increases in average schooling and the real minimum wage helped reduce ethnic, gender, and regional earnings gaps, though all remain rather high. However, since 2014 a major fiscal crisis has negatively affected GDP and the labor market, seriously threatening these achievements. Since 2015, the unemployment rate has jumped from 7.5% to 14%. While real increases in the minimum wage helped reduce inequality during the boom period of the 2000s, since the start of the crisis period in 2014, they have contributed to increasing inequality. Gender and ethnic earnings gaps remain high, at 41% and 15%, respectively. In 2015, only 46% of employees in the private sector were protected by formal contracts.

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This paper provides a detailed exposition of an extension of the Oaxaca-Blinder decomposition method that can be applied to various distributional measures. The two-stage procedure first divides distributional changes into a wage structure effect and a composition effect using a reweighting method. Second, the two components are further divided into the contribution of each explanatory variable using recentered influence function (RIF) regressions. We illustrate the practical aspects of the procedure by analyzing how the polarization of U.S. male wages between the late 1980s and the mid 2010s was affected by factors such as de-unionization, education, occupations, and industry changes.

This paper investigates the effects of the reduction of barriers to trade in the computer technology sector on the Brazilian labor market. We show that the adoption of computers affected labor demand in favor of non-routine tasks, which are complementary to labor, as opposed to routine ones, which are substitutes. Using the end of the non-tariff barriers in Brazil ("Informatics Law") as an instrument, and relying on detailed information on sectors and occupations, we found evidence that industries and occupations intensive in computer use displayed greater shifts toward non-routine and away from routine tasks for most educational group and genders.

This paper investigates the effects of the reduction of barriers to trade in the computer technology sector on the Brazilian labor market. We show that the adoption of computers affected labor demand in favor of non-routine tasks, which are complementary to labor, as opposed to routine ones, which are substitutes. Using the end of the non-tariff barriers in Brazil ("Informatics Law") as an instrument, and relying on detailed information on sectors and occupations, we found evidence that industries and occupations intensive in computer use displayed greater shifts toward non-routine and away from routine tasks for most educational group and genders.

Any opinions expressed here are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to enco...

This paper argues that changes in the returns to occupational tasks have contributed to changes in the wage distribution over the last three decades. Using Current Population Survey (CPS) data, we first show that the 1990s polarization of wages is explained by changes in wage setting between and within occupations, which are well captured by tasks measures linked to technological change and offshorability. Using a decomposition based on Firpo, Fortin, and Lemieux (2009), we find that technological change and deunionization played a central role in the 1980s and 1990s, while offshorability became an important factor from the 1990s onwards.

This paper argues that changes in the returns to occupational tasks have contributed to changes in the wage distribution over the last three decades. Using Current Population Survey (CPS) data, we first show that the 1990s polarization of wages is explained by changes in wage setting between and within occupations, which are well captured by tasks measures linked to technological change and offshorability. Using a decomposition based on Firpo, Fortin, and Lemieux (2009), we find that technological change and deunionization played a central role in the 1980s and 1990s, while offshorability became an important factor from the 1990s onwards.

This paper provides a detailed exposition of an extension of the Oaxaca-Blinder decomposition method that can be applied to various distributional measures. The two-stage procedure first divides distributional changes into a wage structure effect and a composition effect using a reweighting method. Second, the two components are further divided into the contribution of each explanatory variable using recentered influence function (RIF) regressions. We illustrate the practical aspects of the procedure by analyzing how the polarization of U.S. male wages between the late 1980s and the mid 2010s was affected by factors such as de-unionization, education, occupations, and industry changes.

This paper argues that changes in the returns to occupational tasks have contributed to changes in the wage distribution over the last three decades. Using Current Population Survey (CPS) data, we first show that the 1990s polarization of wages is explained by changes in wage setting between and within occupations, which are well captured by tasks measures linked to technological change and offshorability. Using a decomposition based on Firpo, Fortin, and Lemieux (2009), we find that technological change and deunionization played a central role in the 1980s and 1990s, while offshorability became an important factor from the 1990s onwards.

This paper provides a detailed exposition of an extension of the Oaxaca-Blinder decomposition method that can be applied to various distributional measures. The two-stage procedure first divides distributional changes into a wage structure effect and a composition effect using a reweighting method. Second, the two components are further divided into the contribution of each explanatory variable using recentered influence function (RIF) regressions. We illustrate the practical aspects of the procedure by analyzing how the polarization of U.S. male wages between the late 1980s and the mid 2010s was affected by factors such as de-unionization, education, occupations, and industry changes.

This paper investigates the regional and subregional patterns of employment polarisation in Great Britain. Extending recent econometric evidence for employment polarisation at the national level, the focus of analysis is to examine the geography of this polarisation. Methodological issues on how we define and measure ‘job polarisation’ are presented and plausible theories for explaining this polarisation are reviewed. It has

Although relatively well documented and accepted in the US and Europe, the notion of labour market polarization is not so clear in the developing world. In this study, I aim to answer two questions: (i) Are the patterns of employment and wage polarization seen in the industrialized countries also found in Brazil? And (ii) has the occupational structure—what you do—gained importance over the sectoral structure—where you work—in explaining the dynamics of the labour market. By applying standardized and reproducible aggregations of occupations by task content, I found strong evidence of employment polarization but not of wage polarization. Moreover, this study corroborates the idea that the occupational structure is a key driving force behind the determination of employment and wage dynamics, although further investigation is required to understand the relationship between job polarization and the wage distribution. This study also contributes to the literature by adjusting the classif...

It has long been recognized that average wages vary strikingly across regions and urban areas in part due to differences in local amenities and fiscal policies. However, analogous differences in wage dispersion remain relatively unexplored. The authors develop a model suggesting that, after accounting for individual characteristics, wage dispersion across income groups should reflect differences in the relative valuation of local amenities and fiscal policies. The authors empirically investigate whether there is a link between local taxes and expenditures and the degree of dispersion in the wage structure and find evidence that such a relationship exists.

It has long been recognized that average wages vary strikingly across regions and urban areas, in part due to differences in local amenities and fiscal policies. However, analogous differences in wage dispersion remain relatively unexplored. We develop a model suggesting that, after accounting for individual characteristics, wage dispersion across income groups should reflect differences in the relative valuation of local amenities and fiscal policies. We empirically investigate whether there is a link between local taxes and expenditures and the degree of dispersion in the wage structure, and find evidence that such a relationship exists.

US median wages have stagnated for 30 years, yet this masks a surprising amount of variation among different groups. A large literature documents that skill-biased technical change (SBTC) has led to substantial real wage increases on average for those with at least a college degree, and declines on average for those with less education. However, SBTC is not a single dimensional construct. We identify seven orthogonal dimensions of skill across 514 occupations and examine how the earning power of each skill changed over the period 2006-2014. We find that (1) different skills accrue different levels of wage, (2) these wage effects vary on both the actual use of IT in the occupation as well as the general level of IT intensity in the industry, and (3) the technology-skill effects on wage are nonlinear. We discuss implications for workers, educators and policymakers.

In this paper, we compare the income distributions for women and men in Poland. The gender wage gap can only be partially explained by different men's and women's characteristics. The unexplained part of the gap is usually attributed to the wage discrimination. The objective of the study is to extend the Oaxaca-Blinder decomposition procedure for the pay gap along the whole income distribution. To describe differences between two distributions of incomes we use a semiparametric reweighting approach (DiNardo, Fortin, Lemieux, 1996). The reweighting factor is computed for each observation by estimating a logit model for probabilities of belonging to men's or women's group. Then, we estimate probability density functions, including the counterfactual density function, using kernel density methods. This allows us to decompose the inequalities into the explained and unexplained components. The analysis is based on the EU-SILC data for Poland in 2014.

Using decomposition methods, we analyse the role of the changing nature of work in explaining changes in employment, wage inequality, and job polarization in Chile from 1992 to 2017. Changes in occupational structure confirm a displacement of workers from low-skill occupations towards jobs demanding non-routine higher skills (professionals and technicians), and to jobs demanding routine manual and cognitive tasks (services and sales). Changes in occupational earnings have had an equalizing effect, with more substantial gains in favour of lower-skill occupations and also at the top of the skill premium. Inequality reductions since the 2000s are explained by a fall in earnings in the top percentiles of the distribution, which have been reallocated most noticeably around the median (2000–06) and the bottom 30 per cent (2006–17). Changes in the returns to education and the relocation of workers towards less-routine occupations have contributed to the inequality reduction.

Wage inequalities in the UK and elsewhere increased substantially over the last two decades and remained at historically high levels throughout the 1990s. This paper investigates the sources of these inequalities by performing a number of decompositions on the distribution of wages and its change over time. By far, the temporal evolution of the returns to occupations (towards more inequality) is the main determinant of the marked increase in wage inequalities. Nevertheless, more than two thirds of the latter are found to be located within the same region and gender, occupational and education group, with the implication that other factors, not directly related to labour force characteristics, determine the level of wage inequalities. When comparing the regional wage distributions over time, we find that cross-regional differences in wage distributions are again largely deter mined by differences in the occupational composition of the workforce and in the returns to occupations.

This study deals with the evolution of the Brazilian labor market and the distribution of labor income in the recent period of slowdown and economic crisis. During the period analyzed there were significant changes in the labor market with an increase of unemployment and labor informality.  Despite the deterioration of the labor market in recent years, especially in 2015 and 2016, inequality indicators showed a different trend, with continued deconcentration of income and subsequent stabilization until the end of the period. The econometric analysis showed that these results are associated not only with the behavior of the economy but also with the policy of increasing the minimum wage, which maintained the income gains of the lower tenths of the income distribution at higher levels than the ones observed for the higher tenths.  Thus, the dynamics of the Brazilian labor market revealed the importance of public policies to guarantee the living conditions of unemployed workers. For those who remain employed, the object of the present study, policies such as increasing the minimum wage fulfill the function of minimizing the losses in income caused by the crisis.

This article studies how changes in the statutory minimum wage have affected the wage distribution in Estonia, a post-transition country with little collective bargaining and relatively large wage inequality. The analyses show that the minimum wage has had substantial spillover effects on wages in the lower tail of the distribution; the effects are most pronounced up to the twentieth percentile and then decline markedly. The minimum wage has contributed to lower wage inequality and this has particularly benefitted low-wage segments of the labour market such as women and the elderly. Interestingly, the importance of the minimum wage for the wage distribution was smaller during the global financial crisis than before or after the crisis.

Wage inequalities in the UK and elsewhere increased substantially over the last two decades and remained at historically high levels throughout the 1990s. This paper investigates the sources of these inequalities by performing a number of decompositions on the distribution of wages and its change over time. By far, the temporal evolution of the returns to occupations (towards more inequality) is the main determinant of the marked increase in wage inequalities. Nevertheless, more than two thirds of the latter are found to be located within the same region and gender, occupational and education group, with the implication that other factors, not directly related to labour force characteristics, determine the level of wage inequalities. When comparing the regional wage distributions over time, we find that cross-regional differences in wage distributions are again largely deter mined by differences in the occupational composition of the workforce and in the returns to occupations.

This paper investigates the sources of wage inequality across Brazilian regions. Duarte, , using a semi-parametric approach based on DiNardo, , show that income differences across the Southeast and Northeast can be explained by educational disparities across their population. This result implies that any policy recomendation should prescribe direct investments in education in order to narrow the regional income gap. In this paper we apply the methodology developed by Machado and Mata (2004), based on quantile regression and resampling techniques, for the metropolitan areas of Brazilian Southeast and Northeast. The technique allows us to decompose the wage inequality across regions into a part that can be attributed to changes in workers' observable characteristics and another to changes in the returns to these characteristics. First we show that the difference between NE and SE wage distribution has a higher mass on the lower tail, and lower density on the upper tail, resulting from the well known fact that Northeast have a higher number of people living on poverty and lower number of people on high paying occupations compared to Southeast. Both returns to skills and workers' observed characteristics have an impact on this result. However, different from what Duarte et al show on their paper, schooling did not respond for this wage inequality across the two regions. Returns to schooling did have a higher impact on wage inequality than the distribution of education per se. These results imply that investments on education alone may not be enough to narrow regional income inequality since the availability of capital and quality of education may be driving those results.

A number of authors have documented an increase in earnings or income inequality in New Zealand during the late 1980s and early 1990s, a period of major economic reform, however no study has evaluated changes in inequality during the post-reform era. This paper applies a recently-developed method for decomposing changes in inequality to New Zealand income and earnings data and extends it to analyse changes in inequality between men and women. Across the total working-age population, income inequality rose among both males and females between 1998 and 2003. In both cases, the majority of this was unexplained by changes in the observed determinants of income, however shifts in the distribution of education and the associated returns were responsible for part of the increase. Among the subset of workers, earnings inequality increased significantly for both genders. Although changes in the returns to measured characteristics contributed to the rise in inequality, this was partially offs...

In this paper we analyse the role of education on the dynamics of wage structure in Italy. Using SHIW data over the period 1993-2004, we derive two main results in a quintile regression framework. First, returns to education decline over time almost uniformly across the wage distribution. Second, using a quintile decomposition method à la Machado-Mata we point out that the composition effect associated with the increased share of educated workers is positive, while the price effect of education is negative in the whole wage distribution. Assuming a standard demand and supply paradigm, this leads us to the conclusion that a sort of "unskilled" bias technological change could have been prevailing in the Italian labour market during last decade.

In this paper we show that wage inequality decreased in the Italian private sector, both in the upper and in the lower tail of the distribution, in the period 1993-2006. By applying a quantile decomposition procedure we find that the decrease of the 90/50 ratio is almost totally related to a negative coefficients component. As for the reduction of the 50/10 ratio, the quantile decomposition shows that it can be related to both the negative coefficients component and the residual component. We claim that that supply-demand interactions have to be considered as the main explanation for the falling educational wage premia that represent the driving force of the falling 90/50 ratio. The reduction of the 50/10 ratio can be instead associated to the changes in the residual component -related to compositional effects-, to the changes in the occupation distribution and to changes in tax regimes. JEL codes: J24, J31, O3.

This paper investigates the sources of wage inequality across Brazilian regions. Duarte, , using a semi-parametric approach based on DiNardo, , show that income differences across the Southeast and Northeast can be explained by educational disparities across their population. This result implies that any policy recomendation should prescribe direct investments in education in order to narrow the regional income gap. In this paper we apply the methodology developed by Machado and Mata (2004), based on quantile regression and resampling techniques, for the metropolitan areas of Brazilian Southeast and Northeast. The technique allows us to decompose the wage inequality across regions into a part that can be attributed to changes in workers' observable characteristics and another to changes in the returns to these characteristics. First we show that the difference between NE and SE wage distribution has a higher mass on the lower tail, and lower density on the upper tail, resulting from the well known fact that Northeast have a higher number of people living on poverty and lower number of people on high paying occupations compared to Southeast. Both returns to skills and workers' observed characteristics have an impact on this result. However, different from what Duarte et al show on their paper, schooling did not respond for this wage inequality across the two regions. Returns to schooling did have a higher impact on wage inequality than the distribution of education per se. These results imply that investments on education alone may not be enough to narrow regional income inequality since the availability of capital and quality of education may be driving those results.

In this paper, I investigate the prospect that there has been a general 'upskilling'(understood as extensive skill-biased technological change) in the New Zealand workforce. This research, a descriptive study rather than an explanatory one, allows me to tentatively conclude several points. First, there is reason to believe that a general upskilling has occurred. Second, with certain assumptions, it can be shown that real incomes have been growing in the face of increasing supply, indicating strong, increasing relative demand for educated workers. Further, there is more to the determination of incomes than qualifications; to an important extent, the incomes of peers, regardless of qualifications, affect wages. Fourth, women are entering the labour force at a greater rate than men; significantly, this is true at the university end of the qualification spectrum. Finally, there is evidence to suggest a persistent, wide-spread disparity between the incomes of men and women, regardless of qualification, industry, and occupation.

Several empirical studies emphasize the relevance of personality traits on wages. There are various reasons why personality traits can be important in explaining wages. First, employers, co-workers and potential customers may prefer workers with some personality traits rather than others; and these preferences may entail lower wages for people with less preferred personality traits. Second personality may have an effect on job performance and productivity. Third, people with different personality traits may sort out into occupations with different levels of wages.

An in-depth analysis was made of how quickly most people move up the wage scale from minimum wage, what factors influence their progress, and how minimum wage increases affect wage growth above the minimum. Very few workers remain at the minimum wage over the long run, according to this study of data drawn from the 1977-78 May Current Population Survey (CPS) and the 240 monthly CPS Outgoing Group Files from January 1979 to December 1998. Of the youngest, most inexperienced workers, 12 percent earn the minimum wage, but less than 1 percent earn the minimum at ages 46-55. The percentage of those earning the minimum wage also declines as workers achieve higher levels of education. The study also found that over the last 20 years, nearly two-thirds of minimum wage workers moved above the minimum wage within one year of working at the minimum wage. The median annual wage growth for minimum wage workers was 10 percent between 1977 and 1997. Labor market factors also affect wage growth; fo...

Although relatively well documented and accepted in the US and Europe, the notion
of labour market polarization is not so clear in the developing world. In this study, I aim
to answer two questions: (i) Are the patterns of employment and wage polarization seen
in the industrialized countries also found in Brazil? And (ii) has the occupational structure|
what you do|gained importance over the sectoral structure|where you work|in
explaining the dynamics of the labour market. By applying standardized and reproducible
aggregations of occupations by task content, I found strong evidence of employment polarization
but not of wage polarization. Moreover, this study corroborates the idea that the
occupational structure is a key driving force behind the determination of employment and
wage dynamics, although further investigation is required to understand the relationship
between job polarization and the wage distribution. This study also contributes to the
literature by adjusting the classication of occupations (CBO) and activities (CNAE) to
make the categories compatible before and after the 2002 changes. Thus, I preserved all the
National Household Survey Sample's (PNAD-IBGE) valid responses between 1981 and 2013.

Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent, nonprofit limited liability company (Gesellschaft mit beschränkter Haftung) supported by the Deutsche Post AG. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. The current research program deals with (1) mobility and flexibility of labor markets, (2) internationalization of labor markets and European integration, (3) the welfare state and labor markets, (4) labor markets in transition, (5) the future of work, (6) project evaluation and (7) general labor economics.

Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent, nonprofit limited liability company (Gesellschaft mit beschränkter Haftung) supported by the Deutsche Post AG. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. The current research program deals with (1) mobility and flexibility of labor markets, (2) internationalization of labor markets and European integration, (3) the welfare state and labor markets, (4) labor markets in transition, (5) the future of work, (6) project evaluation and (7) general labor economics.

Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent, nonprofit limited liability company (Gesellschaft mit beschränkter Haftung) supported by the Deutsche Post AG. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. The current research program deals with (1) mobility and flexibility of labor markets, (2) internationalization of labor markets and European integration, (3) the welfare state and labor markets, (4) labor markets in transition, (5) the future of work, (6) project evaluation and (7) general labor economics.

Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent, nonprofit limited liability company (Gesellschaft mit beschränkter Haftung) supported by the Deutsche Post AG. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. The current research program deals with (1) mobility and flexibility of labor markets, (2) internationalization of labor markets and European integration, (3) the welfare state and labor markets, (4) labor markets in transition, (5) the future of work, (6) project evaluation and (7) general labor economics.

This paper investigates the sources of wage inequality across Brazilian regions. Duarte, , using a semi-parametric approach based on DiNardo, , show that income differences across the Southeast and Northeast can be explained by educational disparities across their population. This result implies that any policy recomendation should prescribe direct investments in education in order to narrow the regional income gap. In this paper we apply the methodology developed by Machado and Mata (2004), based on quantile regression and resampling techniques, for the metropolitan areas of Brazilian Southeast and Northeast. The technique allows us to decompose the wage inequality across regions into a part that can be attributed to changes in workers' observable characteristics and another to changes in the returns to these characteristics. First we show that the difference between NE and SE wage distribution has a higher mass on the lower tail, and lower density on the upper tail, resulting from the well known fact that Northeast have a higher number of people living on poverty and lower number of people on high paying occupations compared to Southeast. Both returns to skills and workers' observed characteristics have an impact on this result. However, different from what Duarte et al show on their paper, schooling did not respond for this wage inequality across the two regions. Returns to schooling did have a higher impact on wage inequality than the distribution of education per se. These results imply that investments on education alone may not be enough to narrow regional income inequality since the availability of capital and quality of education may be driving those results.

Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent, nonprofit limited liability company (Gesellschaft mit beschränkter Haftung) supported by the Deutsche Post AG. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. The current research program deals with (1) mobility and flexibility of labor markets, (2) internationalization of labor markets and European integration, (3) the welfare state and labor markets, (4) labor markets in transition, (5) the future of work, (6) project evaluation and (7) general labor economics.

This paper decomposes the gender wage gap along the entire wage distribution into an endowment effect and a discrimination effect, taking into account possible selection into full-time employment. Applying a new decomposition approach to the Bangladesh Labour Force Survey (LFS) data we find that women are paid less than men every where on the wage distribution and the gap is higher at the lower end of the distribution. Discrimination against women is the primary determinant of the wage gap. We also find that the gap has widened over the period 1999 -2005. Our results intensify the call for better enforcement of gender based affirmative action policies.

Chile has one of the highest levels of wage inequality in the world, and has had for decades. Nonetheless, this paper argues that if the wage distribution is examined in its entirety, instead of concentrating on specific indicators such as the Gini coefficient or the coefficient of variation of wages, significant changes in wage inequality can be seen over the years. In particular, all the action on inequality is occurring in the upper part of the wage distribution. The authors show that wage inequality grew significantly during the 1960s, reflecting increases in the variance of wages both between and within different skill groups. The fact that this occurred more forcefully in the public sector, leads one to speculate about the possible role played by labor unions in this phenomenon. The two ensuing decades saw significant falls in real wages for all wage earners, reflecting the high inflation rates of the 1970s and the effects of the recessions of 1975 and 1982-83 on the real wages of Chilean white-collar and manual workers. These falls were much Translated by Timothy Ennis 2 ESTUDIOS PÚBLICOS steeper among groups in the middle of the wage distribution. The least affected groups were the top wage earners. This helps to explain an increase in wage dispersion between skill groups which is compensated by a reduction in the intra-group wage dispersion. As a result, during these two decades, the more permanent levels of wage dispersion are not very different from those seen back in 1970. Finally, wage dispersion narrowed slightly in the 1990s, but not enough to compensate for the increases in inequality that occurred during the 1960s. In their analysis, the authors highlight what has been happening with wage-earners who are high-school graduates. These have seen a drastic fall in their wages relative to those with only primary schooling. Whereas in the 1960s high-school graduates earned more than twice the wages of someone with primary education, the difference today is no more than 35%. On the other hand, the returns to higher education have grown significantly during the same period, and the educational differences between high and middle wage groups have widened. All of this goes a long way to explaining why wage inequalities have not decreased over the last four decades, despite the population's average level of schooling rising from seven years in the early 1960s to 11 in the late 1990s.

The objective of this paper is to analyse the impact of routine on jobs using the
European Working Condition Survey dataset. Statistics indicate that the share of
routine jobs decreased between 2000 and 2010, from 49% to 43% of total jobs,
consistently with the task-biased technological change theory by Autor et al. (2003).
Yet, it is unlikely that the process consists of pure destruction: routine may affect
workers also by hitting on wages either because they are not as productive and
efficient as a robot would be, or because they share the dividend of their productivity
with the owner of the technology. Results of the ordered logit estimation indicate that
not only routine tasks are associated to a wage penalty, but also that in half of Western
European countries this penalty increases over the decade. Results are robust to the
definition of routine adopted.