Inequality, mobility and heterogeneity in the labor market: empirical and methodological contributions.

Summary This work brings together four essays devoted to the study of heterogeneity and individual dynamics in the labor market. The first chapter highlights the link between wage mobility (or inertia) and the degree of persistence of inequality. We use a simple and original statistical method to study individual wage trajectories, and apply it to French data covering the period 1990-2002. We find that the recession of the early 1990s was associated with a significant increase in longitudinal inequality. In the second chapter, we study the effect of job mobility on the correlations between wages and non-wage characteristics. In our model, strong preferences for these characteristics do not necessarily translate into negative correlations if mobility frictions are important. On European data, we estimate strong preferences for certain characteristics such as the type of work or job security, as well as very small wage differentials between levels of amenity. Chapters 3 and 4 introduce a method for modeling unobserved heterogeneity: independent component analysis. This differs from principal component analysis in that the factors are not simply assumed to be uncorrelated, but statistically independent. This assumption allows the factors to be identified in an unambiguous way. We apply our method to education wage data in France for the year 1995. Our results suggest a complex and multidimensional relationship between educational attainment and labor market performance.