Working Paper: NBER ID: w1968
Authors: Alan B. Krueger; Lawrence H. Summers
Abstract: This paper reviews available evidence on the inter-industry wage structure. The inter-industry wage structure is remarkably similar in different eras, in different countries, and among different types of workers. Industries with high capital-to-labor ratios, monopoly power and high profits pay relatively high wages. We conclude that the competitive model cannot without substantial modification provide an adequate explanation of the \ninter-industry wage structure. The implications of this finding for micro and macro economic theory and policy are examined.
Keywords: No keywords provided
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| high capital-to-labor ratios (D29) | higher wages (J39) |
| monopoly power (D42) | higher wages (J39) |
| non-competitive factors (rent-sharing and efficiency wages) (D33) | higher wages (J39) |
| controlling for individual worker characteristics (J29) | rankings of industry wage differentials (J31) |
| observed wage differentials (J31) | fundamental economic factors (P42) |