[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"detail-sidebar-cat-1-en-105":3,"doc-seo-301538-105":53,"doc-detail-301538-en":126},{"code":4,"msg":5,"data":6},0,"success",[7,14,19,24,29,34,39,44,49],{"id":8,"doc_module":9,"doc_module_name":10,"category_name":11,"show_sort_weight":12,"slug":13},11,1,"Template","Presentations",90,"presentations",{"id":15,"doc_module":9,"doc_module_name":10,"category_name":16,"show_sort_weight":17,"slug":18},12,"Resumes",80,"resumes",{"id":20,"doc_module":9,"doc_module_name":10,"category_name":21,"show_sort_weight":22,"slug":23},14,"Invoices",70,"invoices",{"id":25,"doc_module":9,"doc_module_name":10,"category_name":26,"show_sort_weight":27,"slug":28},15,"Posters",60,"posters",{"id":30,"doc_module":9,"doc_module_name":10,"category_name":31,"show_sort_weight":32,"slug":33},16,"Social Media",50,"social-media",{"id":35,"doc_module":9,"doc_module_name":10,"category_name":36,"show_sort_weight":37,"slug":38},17,"Forms",40,"forms",{"id":40,"doc_module":9,"doc_module_name":10,"category_name":41,"show_sort_weight":42,"slug":43},18,"Letters",30,"letters",{"id":45,"doc_module":9,"doc_module_name":10,"category_name":46,"show_sort_weight":47,"slug":48},21,"Paper Templates",5,"papers-templates",{"id":50,"doc_module":9,"doc_module_name":10,"category_name":51,"show_sort_weight":4,"slug":52},158,"General","general-158",{"code":4,"msg":54,"data":55},"ok",{"site_id":56,"language":57,"slug":58,"title":59,"keywords":60,"description":61,"schema_data":62,"social_meta":119,"head_meta":121,"extra_data":123,"updated_unix":125},105,"en","firming-up-inequality","FIRMING UP INEQUALITY","","Uses a matched employer-employee database for the United States to study how firms contributed to earnings inequality from 1978 to 2013. Finds one-third of the rise in the variance of log earnings occurred within firms and two-thirds came from higher dispersion of average earnings between firms. Shows between-firm variance is driven by widening gaps in worker composition, combining increased sorting and segregation, while controlling for composition removes rising firm-specific pay variance. Also reports that most within-firm earnings variance growth occurs in mega firms (10,000+ employees).",{"@graph":63,"@context":118},[64,80,101],{"@type":65,"itemListElement":66},"BreadcrumbList",[67,71,74,77],{"item":68,"name":69,"@type":70,"position":9},"https://docshare.wps.com","Home","ListItem",{"item":72,"name":10,"@type":70,"position":73},"https://docshare.wps.com/template/",2,{"item":75,"name":51,"@type":70,"position":76},"https://docshare.wps.com/template/general/",3,{"item":78,"name":59,"@type":70,"position":79},"https://docshare.wps.com/template/firming-up-inequality/301538/",4,{"url":78,"name":59,"@type":81,"image":82,"author":87,"headline":59,"publisher":90,"fileFormat":93,"inLanguage":57,"description":61,"dateModified":94,"datePublished":95,"encodingFormat":93,"isAccessibleForFree":96,"interactionStatistic":97},"DigitalDocument",{"url":83,"@type":84,"width":85,"height":86},"https://docshare.wps.com/thumbnails/firming-up-inequality/301538.png","ImageObject",442,249,{"name":88,"@type":89},"Felix Montgomery","Person",{"url":68,"name":91,"@type":92},"DocShare","Organization","application/pdf","2026-09-22","2026-09-19",true,{"@type":98,"interactionType":99,"userInteractionCount":79},"InteractionCounter",{"@type":100},"ViewAction",{"@type":102,"mainEntity":103},"FAQPage",[104,110,114],{"name":105,"@type":106,"acceptedAnswer":107},"What data is used to study earnings inequality in the paper?","Question",{"text":108,"@type":109},"The paper uses a massive, matched employer-employee database for the United States covering 1978–2013.","Answer",{"name":111,"@type":106,"acceptedAnswer":112},"How much of the increase in earnings inequality is attributed to within-firm vs between-firm changes?",{"text":113,"@type":109},"About one-third comes from within firms, while two-thirds comes from increased dispersion of average earnings between firms.",{"name":115,"@type":106,"acceptedAnswer":116},"What drives the between-firm variance increase according to the results?",{"text":117,"@type":109},"It is driven by compositional changes in firms’ workforces: greater sorting into high-wage firms and higher segregation among workers.","https://schema.org",{"og:url":78,"og:type":120,"og:title":59,"og:site_name":91,"og:description":61},"article",{"robots":122,"canonical":78},"index,follow",{"doc_id":124,"site_id":56},301538,1790036732,{"code":4,"msg":5,"data":127},{"doc_id":124,"user_id":128,"nickname":88,"user_avatar":129,"doc_module":9,"category_id":50,"category_name":51,"doc_title":59,"doc_description":61,"doc_content":130,"file_id":131,"file_url":132,"file_type":133,"file_size":134,"view_count":79,"is_deleted":4,"is_public":9,"is_downloadable":9,"audit_status":9,"page_count":135,"language":136,"language_code":57,"site_id":56,"html_lang":57,"table_of_contents":137,"faqs":138,"seo_title":139,"seo_description":61,"update_tm":140,"read_time":141},549768064778,"https://ap-avatar.wpscdn.com/davatar_6f874abed73319feea01a86fa6f0fab8","FIRMING UP INEQUALITY 􀀃  \nJae Songy  \nDavid J. Pricez  \nFatih Guvenenx  \nNicholas Bloom{  \nTill von Wachter k  \nAbstract  \nWe use a massive, matched employer-employee database for the United States to analyze the contribution of 􀀌rms to the rise in earnings inequality from 1978 to 2013 . We 􀀌nd that one-third of the rise in the variance of (log) earnings occurred within 􀀌rms, whereas two-thirds of the rise occurred due to a rise in the dispersion of average earnings between 􀀌rms. However, this rising between-􀀌rm variance is not accounted for by the 􀀌rms themselves but rather by a widening gap between 􀀌rms in the composition of their workers. This compositional change can be split into two roughly equal parts: high-wage workers became increasingly likely to work in high-wage 􀀌rms (i.e., sorting increased), and highwage workers became increasingly likely to work with each other (i.e., segregation rose) . In contrast, we do not 􀀌nd a rise in the variance of 􀀌rm-speci􀀌c pay once we control for the worker composition in 􀀌rms. Finally, we 􀀌nd that two thirds of the rise in the within-􀀌rm variance of earnings occurred within mega (10,000+ employee) 􀀌rms, which saw a particularly large increase in the variance of earnings compared to smaller 􀀌rms. JEL Codes: E23, J21, J31  \n􀀃 Version: September, 2018 . Special thanks to Gerald Ray and Pat Jonas at the Social Security Administration for their help and support. We thank our formal discussants Pat Kline, Lin Peng, Ben Pugsley, Johannes Schmieder, Andre Shleifer, Larry Katz, 􀀌ve anonymous referees and seminar participants at the AEA, ASU, Berkeley, the White House CEA, Columbia, Chicago, Dartmouth, Drexel, FRBs of Atlanta, New York, and Philadelphia, Harvard, Michigan, MIT, NBER, Northwestern, Princeton, Rand, Stanford, TNIT, UCLA, and Yale for helpful comments. Benjamin Smith and Brian Lucking provided superb research assistance. We are grateful to the National Science Foundation for generous funding. To combat alphabetical inequality author names have been randomly ordered.  \ny Social Security Administration, [jae.song@ssa.gov](jae.song@ssa.gov)  \nz University of Toronto; [david.price@utoronto.ca](david.price@utoronto.ca)  \nx University of Minnesota, FRB of Minneapolis, and NBER; [guvenen@umn.edu](guvenen@umn.edu)  \n{ Stanford University, NBER, and SIEPR; [nbloom@stanford.edu](nbloom@stanford.edu)  \nk UCLA and NBER; [tvwachter@econ.ucla.edu](tvwachter@econ.ucla.edu)  \nI. INTRODUCTION  \nThe dramatic rise in U.S. earnings inequality from the 1970s to today has been well documented (see Acemoglu and Autor (2011) for a detailed review) . An enormous body of theoretical and empirical research has been conducted over the past two decades inan attempt to understand the causes of these trends. Until recently, the analysis of the role of employers has been largely absent from this literature, chie􀀍y because of the lack of a comprehensive, matched employer-employee data set in the United States covering the period of rising inequality.  \nA long literature in economics has recognized that some 􀀌rms pay workers with similar skills more than others (e.g. , Slichter (1950), Dickens and Katz (1987), Krueger and Summers (1988), and Van Reenen (1996)) . Controlling for di􀀋erences in the composition of observed and unobserved worker characteristics between 􀀌rms, an increasing number of studies have shown that these di􀀋erences in 􀀌rm pay premiums contribute substantially to the distribution of earnings (e.g. , Abowd et al. (1999), Goux and Maurin (1999), and Abowd et al. (2002)) .1  \nAn important question is to what extent the di􀀋erences in 􀀌rm pay premiums have widened, and to what extent this widening can explain the observed rise in earnings inequality. In a recent paper, Card et al. (2013) show that a rise in the dispersion of 􀀌rm pay premiums has contributed substantially to recent increases in wage inequality in Germany. They also show that inequality rose in equal measure because of large changes i","cbCaijvT0sJhcDDR","https://ap.wps.com/l/cbCaijvT0sJhcDDR","pdf",1634017,93,"English","# Abstract\n## Introduction","[{\"question\":\"What data is used to study earnings inequality in the paper?\",\"answer\":\"The paper uses a massive, matched employer-employee database for the United States covering 1978–2013.\"},{\"question\":\"How much of the increase in earnings inequality is attributed to within-firm vs between-firm changes?\",\"answer\":\"About one-third comes from within firms, while two-thirds comes from increased dispersion of average earnings between firms.\"},{\"question\":\"What drives the between-firm variance increase according to the results?\",\"answer\":\"It is driven by compositional changes in firms’ workforces: greater sorting into high-wage firms and higher segregation among workers.\"}]","FIRMING UP INEQUALITY | PDF",1789783375,33]