TY  - JOUR
AU  - DiNardo,John
AU  - Fortin,Nicole M.
AU  - Lemieux,Thomas
TI  - Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 5093
PY  - 1995
Y2  - April 1995
UR  - http://www.nber.org/papers/w5093
L1  - http://www.nber.org/papers/w5093.pdf
N1  - Author contact info:
John DiNardo
Ford School of Public Policy
5238 Weill Hall
University of Michigan
Ann Arbor, MI  48109-3091
Tel: 734/647-7843
Fax: 734/763-9181
E-Mail: jdinardo@umich.edu

Nicole Fortin
Department of Economics
University of British Columbia
#997-1873 East Mall
Vancouver, BC V6T 1Z1
Canada
Tel: (604) 822-3222
Fax: (604) 822-5915
E-Mail: nifortin@interchange.ubc.ca

Thomas Lemieux
Department of Economics
University of British Columbia
#997-1873 East Mall
Vancouver, BC V6T 1Z1
CANADA
Tel: 604/822-2092
Fax: 604/822-5915
E-Mail: thomas.lemieux@ubc.ca
AB  - This paper presents a semiparametric procedure to analyze the effects of institutional and labor market factors on recent changes in the U.S. distribution of wages.  The effects of these factors are estimated by applying kernel density methods to appropriately 'reweighted' samples.  The procedure provides a visually clear representation of where in the density of wages these various factors exert the greatest impact.  Using data from the Current Population Survey, we find, as in previous research, that de-unionization and supply and demand shocks were important factors in explaining the rise in wage inequality from 1979 to 1988.  We find also compelling visual and quantitative evidence that the decline in the real value of the minimum wage explains a substantial proportion of this increase in wage inequality, particularly for women.  We conclude that labor market institutions are as important as supply and demand considerations in explaining changes in the U.S. distribution of wages from 1979 to 1988.
ER  -