The skill premium has increased significantly in the United States in the last five decades. During the same period, 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...

This paper proposes a method of measuring chronic and transitory poverty based on any additively-decomposable index of aggregate poverty. Chronic poverty and transitory poverty in the United States are measured using data from the Panel Study of Income Dynamics (1987 interviewing year). In an...

Using a simple model with two levels of skill, we assume that high-skill workers who fail to get high-skill jobs may accept low-skill positions; low-skill workers do not have the analogous option of filling high-skill positions. This asymmetry implies that a slowdown in Hicks-neutral technical...

Minimum wages alter the allocation of firm-idiosyncratic risk across workers. To establish this result, we focus on Italy, and leverage employer-employee data matched to firm balance sheets and hand-collected wage floors. We find a relatively larger pass-through of firm-specific labor-demand...

This paper revisits the induced innovation literature of the 1960s to which Phelps was a major contributor (Drandakis and Phelps, 1965). This literature was the first systematic study of the determinants of technical change and also the first investigation of the relationship between factor...

SBTC is a powerful mechanism in explaining the increasing gap between educated and uneducated wages. However, SBTC cannot mimic the US within-group wage inequality. This paper provides an explanation for the observed intra-college group inequality by showing that the top decile earners'...

I document seven new facts about wage changes. 1) Most pay revisions occur at yearly frequency, but a small proportion occur at idiosyncratic times. 2) Idiosyncratic pay changes are larger and more dispersed than year-end pay changes and resemble more pay changes occurring at job-to-job...

Minimum wages generate an asymmetric pass-through of €rm shocks across workers. We establish this result leveraging employer-employee data on Italian metalmanufacturing €rms, which face di‚erent wage ƒoors that vary within occupations. In response to negative €rm productivity shocks,...