Dube Awarded $75,000 Grant to Study Wage Inequality

Image
Arindrajit Dube
Arindrajit Dube

Economist Arindrajit Dube has been awarded a $75,000 grant by the Washington Center for Equitable Growth for his research on the channels through which economic inequality affects economic growth and stability.

Dube’s project, “Firm wage policies and inequality: Evidence using matched employer-employee data,” will investigate the source of differences in wages being paid to similar workers at different establishments to quantify how sensitive wages are to local labor market conditions.

An associate professor of economics, Dube is one of 24 academics selected by the Washington Center this year to receive grants totaling nearly $900,000. The organization selected 12 faculty and 12 doctoral students for their grants, which now total more than $3.8 million awarded to more than 150 researchers over five years.

Dube will use the grant to seek a better understanding of the set of implicit and explicit rules that govern pay-setting within companies, and explore how these policies interact with market forces to shape the earnings distribution.

Using matched employer-employee data from the Longitudinal Employer-Household Dynamics program of the U.S. Census Bureau’s Center for Economic Studies, the research will quantify how sensitive wages are to local labor market conditions, including policies, and will measure the extent of centralization of firms’ wage policies.

It will also assess whether firms’ concentration in the relevant labor market affects wage premiums. The project generally aims to further understanding of the role of labor market frictions and organizational factors in determining earnings inequality.

The Washington Center for Equitable Growth is a non-profit research and grant-making organization dedicated to advancing evidence-backed ideas and policies that promote strong, stable and broad-based economic growth. More information about the organization and this year’s grant recipients can be found at www.EquitableGrowth.org.