Ioana Marinescu, Ronald Wolthoff, 06 November 2016

One of the fundamental questions in labour economics is why some workers are paid more than others within the same industry. This column uses data from adverts on a large US job website to investigate what's behind these wage differences. The job titles used in adverts capture more variation between jobs than standard occupational classifications. By failing to recognise this, the previous literature has attributed too much of wage inequality to luck and too little to differences in worker and firm characteristics.

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