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Wage dispersion in Germany and the US: is there compression from below?

Möller, Joachim



Abstract

Compression from below is a common diagnosis for the German compared to the U.S. wage distribution. We develop alternative hypotheses in order to identify the so-called accordion effect, i.e. reduced inter-quantile distances below the median especially for low skilled and other ill-paid groups. Using large micro data sources we find evidence of an accordion effect at the low end of the ...

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