Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282820 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16693
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We analyse thirty years of Italian private sector employment data (1985-2018) to study the dynamics of rising earnings inequality. The total variance surged by 10 log points, with 55% occurring between industries, particularly in a few low-paid service sectors. Workers with low earnings ability showed increased likelihood of working in industries with low average firm premium (sorting) together with other low-earning workers (segregation). Strikingly, parallels with the US emerge. In both, inequality increased predominantly between industries and concentrated within a small number of sectors. Italy's increase primarily stems from low-paying sectors, diverging from the more balanced growth observed in the US across high-paying and low-paying industries. Our findings suggest that despite institutional differences similar underlying forces are at work.
Subjects: 
earnings inequality
industries
sorting
segregation
JEL: 
E02
E25
J01
Document Type: 
Working Paper

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