Hours Worked, Self-Employment and Joblessness as Ingredients of Earnings Inequality

This chapter broadens the focus from wage inequality among full-time workers to earnings inequality among all workers. It accounts for the effects of adding parttime workers and the self-employed and includes both groups in analyses of levels of and trends in the distribution of earnings. The chapter first identifies the contribution of self-employment and its distributional patterns to inequality of annual earnings. It then examines whether trends in “prices”, i.e. trends in hourly wage rates, have a lesser or greater impact on levels of and changes in inequality than trends in “quantities”, i.e. trends in hours worked. In a second step, the chapter broadens the focus to the whole working-age population and analyses to what extent shifts in joblessness affect estimates of an “overall” earnings distribution, i.e. including workers and the jobless.