Abstract
We examine the impact of annual hours worked on annual earnings by
decomposing changes in the real annual earnings distribution into
composition, structural and hours effects. We do so via a nonseparable
simultaneous model of hours, wages and earnings. Using the Current
Population Survey for the survey years 1976--2019, we find that changes in
the female distribution of annual hours of work are important in explaining
movements in inequality in female annual earnings. This captures the
substantial changes in their employment behavior over this period. Movements
in the male hours distribution only affect the lower part of their earnings
distribution and reflect the sensitivity of these workers' annual hours of
work to cyclical factors.
decomposing changes in the real annual earnings distribution into
composition, structural and hours effects. We do so via a nonseparable
simultaneous model of hours, wages and earnings. Using the Current
Population Survey for the survey years 1976--2019, we find that changes in
the female distribution of annual hours of work are important in explaining
movements in inequality in female annual earnings. This captures the
substantial changes in their employment behavior over this period. Movements
in the male hours distribution only affect the lower part of their earnings
distribution and reflect the sensitivity of these workers' annual hours of
work to cyclical factors.
| Original language | English |
|---|---|
| Pages (from-to) | 659-678 |
| Number of pages | 20 |
| Journal | Journal of Applied Econometrics |
| Volume | 39 |
| Issue number | 4 |
| Early online date | 25-Mar-2024 |
| DOIs | |
| Publication status | Published - Jun-2024 |