Working Paper: NBER ID: w9313
Authors: George J. Borjas
Abstract: This paper uses data from the U.S. Decennial Census and the Current Population Surveys to document the differential shifts that occurred in the wage structures of the public and privatesectors between 1960 and 2000. The wage gap between the typical public sector worker and a comparable private sector worker was relatively constant for men during this period, but declined substantially for women. Equally important, wage dispersion in the public sector was increasing relative to wage dispersion in the private sector prior to 1970, at the time when public sector employment was rising rapidly. Since 1970, however, there has been a significant relative compression of the wage distribution in the public sector. The different evolutions of the wage structures in the two sectors are an important determinant of the sorting of workers across sectors. As a result of the relative wage compression, the public sector found it increasingly more difficult to attract and retain high-skill workers
Keywords: No keywords provided
JEL Codes: J3; J4
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| relative wage compression in the public sector since 1970 (J45) | decrease in the likelihood of high-skill private sector workers leaving for public sector jobs (J45) |
| wage structure changes in the public sector (J45) | increase in the likelihood of high-skill public sector workers leaving for private sector jobs (J45) |