Falling wages and discretionary pay-setting practices

[Research Highlight]

February 06, 2023

A decline in the use of standardized pay rates contributed to stagnating wages from the 1970s to the mid-1990s.

Wage Stagnation and the Decline of Standardized Pay Rates, 1974–1991

By Maxim Massenkoff ⓡ Nathan Wilmers

American Economic Journal: Applied Economics, January 2023

Using new establishment-by-occupation microdata, we show that the use of discretionary wage setting significantly expanded in the 1970s and 1980s. Increasingly, wages for blue-collar workers were not standardized by job title or seniority but instead subj...

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Front Matter

American Economic Review, June 2005

Foreword

By Avinash K. Dixit

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