Wages have been spreading out across workers over time - or in other words, the 90th/50th wage ratio has risen over time. A key question is, has the productivity distribution also spread out across worker skill levels over time? Using our calculations of productivity by skill level for the U.S.,...

Most economists maintain that the labor market in the United States is 'tight' because unemployment rates are low. They infer from this that there is potential for wage-push inflation. However, real wages are falling rapidly at present and, prior to that, real wages had been stagnant for some...

This chapter reviews the theory of monopsonistic wage setting, its empirical implications, and some puzzles the framework has struggled to explain. We begin by examining the fundamentals of monopsonistic wage determination. The core of the theory is a mapping from the distribution of worker...

The recent shift to remote work raised the amenity value of employment. As compensation adjusts to share the amenity-value gains with employers, wage-growth pressures moderate. We find empirical support for this mechanism in the wage-setting behavior of U.S. employers, and we develop novel...

We show that time variation in risk premia leads to time-varying idiosyncratic income risk for workers. Using US administrative data on worker earnings, we show that increases in risk premia lead to lower earnings for low-wage workers; these declines are primarily driven by job separations. By...

We study the effects of the unionization of faculty at Canadian universities from 1970-2022 using an event-study design. Using administrative data which covers the full universe of faculty salaries, we find strong evidence that unionization leads to both average salary gains and compression of...

We use novel surveys of firms and workers, linked to administrative employer-employee data, to study the prevalence and importance of individual bargaining in wage determination. We show that simple survey questions accurately elicit firms' bargaining strategies. Using the elicited strategies...

Males comprise a small fraction of the nurse labor force, yet across the distribution of wages, male nurses earn more than females. In this paper, we use nurse survey data to decompose the sex-based wage gap and to explore why male nurses earn a premium in a female-dominated profession. We...

We study the importance of firm sorting for spatial inequality. If productive locations are able to attract the most productive firms, then firm sorting acts as an amplifier of spatial inequality. We develop a novel model of spatial firm sorting, in which heterogeneous firms first choose a...

We analyze the economic consequences of rising health care prices in the US. Using exposure to price increases caused by horizontal hospital mergers as an instrument, we show that rising prices raise the cost of labor by increasing employer-sponsored health insurance premiums. A 1% increase in...