We estimate the distribution of life cycle wages for cohorts of prime-age men and women in the US. A quantile selection model is used to consistently recover the full distribution of wages accounting for systematic differences in employment, permitting us to construct gender- and education-specific age-wage profiles, as well as measures of life cycle inequality within- and between-education groups and gender. Although common within-group time effects are shown to be a key driver of labor market inequalities, important additional differences by birth cohort emerge with older cohorts of higher educated men partly protected from the lower skill prices of the 1970s. The gender wage gap is found to increase sharply across the distribution in the first half of working life, coinciding with fertility cycles of women. After age 40, there has been substantial gender wage convergence in recent cohorts relative to those born prior to the 1950s.
Authors
CPP Co-Director
Richard is Co-Director of the Centre for the Microeconomic Analysis of Public Policy (CPP) and Senior Research Fellow at IFS.
Research Fellow University of Kentucky
James, an IFS Research Fellow, is a Professor of Economics holding the Carol Martin Gatton Endowed Chair in Microeconomics at University of Kentucky.
University of Chicago
Working Paper details
- DOI
- 10.1920/wp.ifs.2023.1623
- Publisher
- Institute for Fiscal Studies
Suggested citation
R, Blundell and H, Lopez and J, Ziliak. (2023). Labour market inequality and the changing life cycle profile of male and female wages. 23/16. London: Institute for Fiscal Studies. Available at: https://ifs.org.uk/publications/labour-market-inequality-and-changing-life-cycle-profile-male-and-female-wages (accessed: 9 May 2024).
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