We estimate the changes in US male labor market risk over the last three decades in a model of endogenous labor supply … a life-cycle model with search frictions, we show that the estimated changes in risk can account for 85 percent of the … increase in within group wage inequality. The welfare costs of rising risk are small …

We estimate the changes in US male labor market risk over the last three decades in a model of endogenous labor supply … a life-cycle model with search frictions, we show that the estimated changes in risk can account for 85 percent of the … increase in within group wage inequality. The welfare costs of rising risk are small. …

, individual wage risk has also increased. This paper proposes a mechanism through which a rise in wage risk increases the skill … premium. Intuitively, a rise in uninsured wage risk increases precautionary savings, thereby boosting capital accumulation … that the rise in wage risk observed between 1967 and 2010 increases the skill premium significantly. This finding is robust …

implications for consumption dynamics, consumption insurance, and welfare. We show four main results. First, the benchmark process … idiosyncratic risk implied by the benchmark process is between two-to-four times higher than the canonical Gaussian one. Third, the … transitory income (e.g., from a stimulus check) is higher under non-Gaussian earnings risk. …

We decompose permanent earnings risk into contributions from hours and wage shocks. In order to distinguish between … role in explaining the cross-sectional variance in earnings growth, but wage risk has greater relevance. Allowing for hours … shocks improves the model fit considerably. The empirical strategy allows for the estimation of the Marshallian labor supply …

-cycle insurance impact is much smaller. At the mean, a positive hours shock of one standard deviation raises life-time income by 10 …We decompose permanent earnings risk into contributions from hours and wage shocks. To distinguish between hours shocks …-cycle model of consumption and labor supply. Both permanent wage and hours shocks are important to explain earnings risk, but wage …

-cycle insurance impact is much smaller. At the mean, a positive hours shock of one standard deviation raises life-time income by 10 …We decompose permanent earnings risk into contributions from hours and wage shocks. To distinguish between hours shocks …-cycle model of consumption and labor supply. Both permanent wage and hours shocks are important to explain earnings risk, but wage …

the hypothesis that a rigid wage structure has been responsible for rising low-skilled unemployment, I propose a … stability of educational wage premia was justified by market forces. However, relative wages did not respond to negative net …

the hypothesis that a rigid wage structure has been responsible for rising low-skilled unemployment, I propose a … stability of educational wage premia was justified by market forces. However, relative wages did not respond to negative net …