Journal Article

The heterogeneous cyclicality of income and wages among the distribution in the UK

By María Cervini-Plá, Antonia López-Villavicencio and José I. Silva

Publication details

Publication date
Published in
The B.E. Journal of Economic Analysis & Policy
Volume
18
Publishers
Berkeley Electronic Press, De Gruyter
DOI
https://doi.org/10.1515/bejeap-2017-0181
ISSN
19351682
Accepted version - From the Selected Works of José Ignacio Silva

Summary

We investigate the cyclicality of real hourly wages and income using individual data for the UK over the 1991–2013 period. By paying special attention to the heterogeneity among different earnings and income groups, we document that individuals at the top of the distribution are more cyclical than lower ones. We also show that real wages and income are roughly acyclical for low-wage and low-income workers. In particular, we present evidence that the adjustment for low-paid workers takes place through transitions to and from unemployment.

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