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The heterogeneous cyclicality of income and wages among the distribution

Author

Listed:
  • María Cervini-Plá

    (EQUALITAS, Spain)

  • Antonia López-Villavicencio

    (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France)

  • José I. Silva

    (Universitat de Girona and University of Kent, Campus de Montilivi, 17071, Girona)

Abstract

We investigate the cyclicality of real wages and income using individual data for the UK over the 1991-2008 period. By paying special attention to the heterogeneity among different earnings and income groups, we document that individuals at the top of the distribution are more cyclical than lower ones. Moreover, the estimated cyclicality is considerably higher in recessions than in expansions for top-incomes. We also show that real wages and income are roughly acyclical for low wage and income workers. Instead, their adjustment to the cycle takes place through transitions to and from unemployment.

Suggested Citation

  • María Cervini-Plá & Antonia López-Villavicencio & José I. Silva, 2015. "The heterogeneous cyclicality of income and wages among the distribution," Working Papers 1506, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    • Handle: RePEc:gat:wpaper:1506
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    Cited by:

    1. Bjorn Dapi, 2020. "Wage Cyclicality and Composition Bias in the Norwegian Economy," Scandinavian Journal of Economics, Wiley Blackwell, vol. 122(4), pages 1403-1430, October.

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    More about this item

    Keywords

    Real wage; cyclicality; heterogeneity; income distribution;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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