Rising Wage Inequality in Germany

This paper investigates the evolution of wages and the recent tendency to rising wage inequality in Germany, based on the German Socio-Economic Panel (GSOEP) for 1984 to 2004. Between 1984 and 1994 the wage distribution was fairly stable. Wage inequality started to increase around 1994 in Germany for all workers and for prime age dependent male workers as well. Rising inequality is not the result of the recent rise in self-employment. In West Germany rising inequality occurred in the lower part of the wage distribution, in East Germany in the upper part of the wage distribution. While residual wage inequality accounted for two-thirds of rising wage inequality in West Germany, in East Germany price effects dominated. In West Germany the group of workers with low tenure experienced higher inequality. --Education,tenure,skill composition,wage inequality,wage rigidity

Rising Wage Inequality in Germany

Based on samples from the German Socio-Economic Panel (GSOEP) 1984 to 2004, this paper investigates the evolution of wages and wage inequality in Germany. Between 1984 and 1994 wages for prime age dependent male workers increased on average by 23 percent and the wage distribution in West Germany was fairly stable. Between 1994 and 2004 average wages rose by about 8 percent in West Germany and 28 percent in East Germany. In this period wage inequality for prime age dependent males, measured by the ratio of the ninetieth to tenth percentile of the wage distribution, increased from 2.1 to 2.5 in West Germany and from 2.3 to 2.9 in East Germany. In West Germany rising wage inequality has occurred mainly in the lower part of the wage distribution, whereas in East Germany wage inequality predominantly rose in the upper part of the wage distribution. In West Germany the group of workers with low tenure experienced higher increases in wage inequality.Tenure, skill composition, wage inequality, wage rigidity

Rising Wage Inequality in Germany

The paper investigates the evolution of wages and wage inequality in Germany based on samples from the German Socio-Economic Panel (SOEP) 1984 to 2005. Real gross hourly wages for prime age dependent male workers increased on average by 23 percent between 1984 and 1994 in West Germany and the wage distribution was fairly stable. Between 1994 and 2005 average wages increased by 7 percent in West Germany and 18 percent in East Germany. In this period wage inequality, measured by the ratio of the ninetieth to tenth percentile of the wage distribution, increased from 2.5 to 3.1 in West Germany and from 2.4 to 3.2 in East Germany. In West Germany rising wage inequality occurred mainly in the lower part of the wage distribution, whereas in East Germany wage inequality predominantly increased in the upper part of the wage distribution. In West Germany the group of workers with low tenure experienced higher increases in wage inequality compared to the group of workers with high tenure. --Wage Inequality,Skill Structure,Real Wages,Tenure

Gregariousness, Interactive Jobs and Wages

Gregariousness is an important aspect of human life with implications for labour market outcomes. The paper examines, to the best of our knowledge for the first time for Germany, gregariousness and social interaction at the workplace and associated wage differentials. Our empirical findings with samples from the German Socio-Economic Panel (SOEP) demonstrate that gregarious people more often work in jobs with social interaction. Furthermore, females tend to work more often in interactive jobs compared to males. There is evidence that working in an interactive job is associated with a compensating negative wage differential of 7 percent for women and non for men. Implications for wage policy are discussed.Gregariousness, social interactions, labour markets, sorting, wage differentials

Gregariousness, interactive jobs and wages

Gregariousness is an important aspect of human life with implications for labour market outcomes. The paper examines, to the best of our knowledge for the first time for Germany, gregariousness and social interaction at the workplace and associated wage differentials. Our empirical findings with samples from the German Socio-Economic Panel (SOEP) demonstrate that gregarious people more often work in jobs with social interaction. Furthermore, females tend to work more often in interactive jobs compared to males. There is evidence that working in an interactive job is associated with a compensating negative wage differential of 7 percent for women and non for men. Implications for wage policy are discussed. --Gregariousness,social interactions,labour markets,sorting,wage differentials

Einstiegslöhne bei unvollkommenen Arbeitsmärkten

In der vorliegenden Arbeit werden die Bestimmungsgründe von Einstiegslöhnen, sowie das Ausmaß von Lohnrigiditäten und der daraus abgeleiteten Höhe der Lohnaufschwemmung in der Gruppe der Einsteiger empirisch untersucht. Einsteiger sind Arbeitnehmer, die erstmals bzw. nach einer Unterbrechung in einem Betrieb Beschäftigung finden. In Westdeutschland gehörten im Zeitraum zwischen den Jahren 1976 bis 1995 etwa 11 Prozent der zu einem Stichtag beschäftigten Arbeitnehmer zur Gruppe der Einsteiger. Die durchschnittlichen Tagesverdienste von Einsteigern liegen um bis zu 40% unter denen der betriebstreuen Arbeitnehmer. Bis zu 65% dieses Unterschiedes geht auf beobachtete Heterogenität zurück. Die Einstiegslöhne wären bei Lohnflexibilität etwa um zwei Prozent pro Jahr niedriger gewesen. Lohnrigiditäten scheinen demnach eine wichtige Ursache für die anhaltende und hartnäckige Arbeitslosigkeit in der Bundesrepublik zu sein

Wage convergence and inequality after unification : (East) Germany in transition

This paper investigates the wage convergence between East German workers and their West German counterparts after reunification. Our research is based on a comparison of three groups of workers defined as stayers, migrants and commuters to West Germany, who lived in East Germany in 1989, with groups of West German statistical twin workers, all taken from the Socio-Economic Panel (SOEP). According to our findings, wage convergence for stayers is roughly 75 percent and for commuters 85 percent. Wages of migrants to West Germany equal the ones of their West German statistical twins. We conclude that labor markets in East and West Germany are still characterized by wage differences but that the degree of inequality in both regions converged

Rising wage inequality in Germany

This paper investigates the evolution of wages and the recent tendency to rising wage inequality in Germany, based on the German Socio-Economic Panel (GSOEP) for 1984 to 2004. Between 1984 and 1994 the wage distribution was fairly stable. Wage inequality started to increase around 1994 in Germany for all workers and for prime age dependent male workers as well. Rising inequality is not the result of the recent rise in self-employment. In West Germany rising inequality occurred in the lower part of the wage distribution, in East Germany in the upper part of the wage distribution. While residual wage inequality accounted for two-thirds of rising wage inequality in West Germany, in East Germany price effects dominated. In West Germany the group of workers with low tenure experienced higher inequality