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Public employment redux
- Source :
- Journal of Government and Economics, Vol 1, Iss , Pp 100003- (2021)
- Publication Year :
- 2021
- Publisher :
- Elsevier, 2021.
-
Abstract
- The public sector hires disproportionately more educated workers. To rationalize this finding, we propose a model with a perfectly competitive private sector, and non-Walrasian public sector. Our economy also features heterogeneity across individuals and jobs, and a simple sorting mechanism that generates underemployment - educated workers performing unskilled jobs. We find that the public-sector wage differential and excess underemployment account for 15 percent of the education bias, with the remaining accounted for by technology. In a counterintuitive fashion, we find that more compressed wages in the public sector raise inequality in the private sector.
Details
- Language :
- English
- ISSN :
- 26673193
- Volume :
- 1
- Issue :
- 100003-
- Database :
- Directory of Open Access Journals
- Journal :
- Journal of Government and Economics
- Publication Type :
- Academic Journal
- Accession number :
- edsdoj.b57c4657a304283a84251a4cefd1de3
- Document Type :
- article
- Full Text :
- https://doi.org/10.1016/j.jge.2021.100003