No open-access location is known for this record yet.
No open-access location is known for this record yet.
We argue that financial market development contributed to the rise in the skill premium and residual wage inequality in the US since the 1980s. We present an endogenous growth model with imperfect credit markets and establish how improving the efficiency of these markets affects modes of production, innovation and wage dispersion between skilled and unskilled workers. The experience of US states following banking deregulation provides empirical support for our hypothesis. We find that wages of college educated workers increased by between 0.5 % - 1.2 % following deregulation while those of workers with a high school diploma fell by about 2.2 %. Similarly, residual (or within-group) inequality increased. The 90-50 percentile ratio of residuals from a Mincerian wage regression and their standard deviation increased by 4.5% and 1.8%, respectively.
Loading…
Stored only when both papers are in the corpus — 63 citations exist upstream.
Papers that cite the same references — the relational fallback while embeddings are still backfilling.
Imported from OpenAlex (CC0) — nothing here is generated.