Since the 1980's, wage inequality has increased substantially in the U.S. and U.K while changing little in most of continential European countries (CEU). This paper studies the effects of differences in labor income tax policies between US-UK and CEU for these trends. We begin by documenting...

Based on our estimates (in progress), we plan to analyze how and why the following have changed over time and across cohorts: (i) overall and within-group wage inequality, (ii) lifecycle wage growth, (iii) job promotion rates, (iv) implied on-the-job investment. We are particularly interested in...