{"title":"Relative performance evaluation and wage inequality","authors":"Jiancai Pi, Zixin Li","doi":"10.1111/manc.12469","DOIUrl":null,"url":null,"abstract":"<p>This paper studies the impact of relative performance evaluation (RPE) on skilled-unskilled wage inequality. We find that in an economy with full employment, skilled-unskilled wage inequality will be expanded when the strength of RPE increases. However, when the urban sector is under the minimum wage restriction, the impact of RPE on skilled-unskilled wage inequality depends on the substitution elasticity between land and unskilled labor in the rural sector. If this substitution elasticity is sufficiently large (resp. small), skilled-unskilled wage inequality will be expanded (resp. narrowed down) when the strength of RPE rises.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"92 3","pages":"296-312"},"PeriodicalIF":0.7000,"publicationDate":"2024-01-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Manchester School","FirstCategoryId":"96","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/manc.12469","RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
This paper studies the impact of relative performance evaluation (RPE) on skilled-unskilled wage inequality. We find that in an economy with full employment, skilled-unskilled wage inequality will be expanded when the strength of RPE increases. However, when the urban sector is under the minimum wage restriction, the impact of RPE on skilled-unskilled wage inequality depends on the substitution elasticity between land and unskilled labor in the rural sector. If this substitution elasticity is sufficiently large (resp. small), skilled-unskilled wage inequality will be expanded (resp. narrowed down) when the strength of RPE rises.
期刊介绍：
The Manchester School was first published more than seventy years ago and has become a distinguished, internationally recognised, general economics journal. The Manchester School publishes high-quality research covering all areas of the economics discipline, although the editors particularly encourage original contributions, or authoritative surveys, in the fields of microeconomics (including industrial organisation and game theory), macroeconomics, econometrics (both theory and applied) and labour economics.
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