This article decomposes the rise in the cross-sectional variance of male annual earnings in Sweden between 1991 and 1999 into its persistent and transitory components. The results show that the persistent component accounts for basically all of the increase in earnings dispersion. This implies...

This paper investigates the role of skill depreciation in the relationship between work interruptions and subsequent wages. Using Swedish data from two waves (1994 and 1998) of the International Adult Literacy Survey, which included results of tests gauging respondents' ability to read and make...

This paper disentangles the effect of inequality in permanent and transitory wages on hours worked by, first, estimating the two components for Swedish industries and, second, using the resulting estimates as explanatory variables in an hours-worked equation. Consistent with Bell and Freeman’s...

Calibrations of models related to life-cycle behavior of consumption and saving often invoke the important assumption of a unit root in individuals׳ labor-income process. We for the first time test this assumption using methods for univariate time series. Based on longitudinal register data...

The informational value of the aggregate US unemployment rate has recently been questioned because of a unit root in the labor-force participation rate; the lack of mean reversion implies that long-run changes in unemployment rates are highly unlikely to reflect long-run changes in joblessness....