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Advisor(s)
Abstract(s)
We analyse the implications of labour-market institutions on wage inequality in favour of skilled
labour, on relative unemployment of unskilled labour, and on the economic growth rate in two
clusters resulting from 27 OECD countries: Cluster 1, closely related with the Anglo-Saxon model,
and Cluster 2, dominated by the Continental-European model. By linking the unskilled wage to
the skilled one in Cluster 2, due to the indexation of social benefits to per-capita income, we
accommodate the observed paths of the three variables in both clusters between 1991 and 2008:
Cluster 1 presents a higher wage inequality in favour of skilled labour, a lower unemployment of
the unskilled labour, and a better economic growth rate
Description
Keywords
Labour-market institutions (Un)employment Endogenous economic growth Calibration Wage inequality