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    Public employment redux

    Garibaldi, P. and Gomes, Pedro and Sopraseuth, T. (2021) Public employment redux. Journal of Government and Economics 1 , p. 100003. ISSN 2667-3193.

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    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.

    Metadata

    Item Type: Article
    Keyword(s) / Subject(s): Public-sector employment, Public-sector wages, Underemployment, Education
    School: Birkbeck Faculties and Schools > Faculty of Humanities and Social Sciences > School of Social Sciences
    Depositing User: Administrator
    Date Deposited: 12 Apr 2021 15:38
    Last Modified: 02 Aug 2023 18:09
    URI: https://eprints.bbk.ac.uk/id/eprint/43863

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