Skill Compression, Wage Differentials and Employment: Germany vs. the US / Richard B. Freeman, Ronald Schettkat.

Format:

Book

Author/Creator:

Freeman, Richard B.

Contributor:

National Bureau of Economic Research.

Schettkat, Ronald.

Series:

Working Paper Series (National Bureau of Economic Research) no. w7610.

NBER working paper series no. w7610

Language:

English

Subjects (All):

Wage differentials.

Job creation.

Federal aid to research.

Unskilled labor.

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Skill Compression, Wage Differentials and Employment

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2000.

Cambridge, Massachusetts : National Bureau of Economic Research, 2000.

Summary:

Germany's more compressed wage structure is taken by many analysts as the main cause of the German-US difference in job creation. We find that the US has a more dispersed level of skills than Germany but even adjusted for skills, Germany has a more compressed wage distribution than the US. The fact that jobless Germans have nearly the same skills as employed Germans and look more like average Americans than like low skilled Americans runs counter to the wage compression hypothesis. It suggests that the pay and employment experience of low skilled Americans is a poor counterfactual for assessing how reductions in pay might affect jobless Germans.

Notes:

Print version record

March 2000.