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Title: The Effects of the National War Labor Board on Labor Income Inequality *
Citation Type: Miscellaneous
Publication Year: 2021
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Abstract: During World War II, the United States federal government instituted an explicit policy of wage controls through the National War Labor Board with the aim of controlling inflation and discouraging labor mobility. These wage controls, which differed by industry, occupation, and geographic region, specified maximum allowable raises for those earning less than a certain level (the so-called "bracket") and froze wages greater than that level. We study the persistent effects of these policies on the within-occupation distribution of labor income drawing on the U.S. Censuses of Population from 1960 to 2000. We find that higher brackets were associated with relative increases in inequality as measured by the p10-p90 and p25-p75 ratios between 1940 and all the way up to 1970 with no effects detectable from 1980 onward. These effects are concentrated in the left tail of the earnings distribution. A one standard deviation increase in the bracket relative to the 10th percentile of an occupation-region's labor earnings distribution in 1940 reduces the change in the log 10-50 ratio in 1960 by 18 log points.
Url: https://www.colorado.edu/economics/sites/default/files/attached-files/vickers.pdf
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Authors: Vickers, Chris; Ziebarth, Nicolas L
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Data Collections: IPUMS USA - Ancestry Full Count Data
Topics: Labor Force and Occupational Structure, Methodology and Data Collection
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