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Small Firms, Contracting‐out, Computers and Wage Inequality: Evidence from UK Manufacturing
Author(s) -
Heskel Jonathan
Publication year - 1999
Publication title -
economica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.532
H-Index - 65
eISSN - 1468-0335
pISSN - 0013-0427
DOI - 10.1111/1468-0335.00153
Subject(s) - wage inequality , labour economics , economics , wage , panel data , wage growth , inequality , manufacturing , percentage point , business , finance , econometrics , marketing , mathematical analysis , mathematics
What demand‐side and institutional factors raised the skilled wage premium over the 1980s in UK manufacturing? Using a panel of 80 industries over 1980–9, we find that (1) the average skill premium rose by around 13 percentage points; (2) computer introduction explains around 50% of thisrise; (3) the growth in small firms and in contracting‐out together explain around 20% of the rise; and (4) the fall in unionization explains around 15% of the rise.