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Title: Public Sector Employment and the Skill Premium: Sweden versus the United States, 1970–2012

Citation Type: Journal Article

Publication Year: 2019

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Abstract: Swedish census data and tax records reveal an astonishing decline in the aggregate skill premium of 30 percent between 1970 and 1990, with only a modest recovery in the next couple of decades. In contrast, the US skill premium rose by around 24 percent over those four decades. A theory that equalizes wages with marginal products can rationalize these disparate outcomes when we replace commonly used measures of total labor supplies by private sector employment. The dramatic decline of the skill premium in Sweden is the result of an expanding public sector that has disproportionately hired unskilled labor.

Url: http://onlinelibrary.wiley.com/doi/10.1111/sjoe.12284/full

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Authors: Domeij, David; Ljungqvist, Lars

Periodical (Full): The Scandinavian Journal of Economics

Issue: 1

Volume: 121

Pages: 3-31

Data Collections: IPUMS CPS

Topics: Labor Force and Occupational Structure

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