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Article Dans Une Revue Mimeo, Institute for International Economic Studies, Stockholm University Année : 2020

The curious incidence of shocks along the income distribution

Tobias Broer
John Kramer
  • Fonction : Auteur
Kurt Mitman
  • Fonction : Auteur

Résumé

We use detailed labor market data from Germany to study the comovement of individual earnings as well as separation and job-finding probabilities with fluctuations in aggregate output. In addition, we estimate impulse responses of these variables to monetary policy shocks identified from high-frequency changes in Overnight Indexed Swap rates. We find that workers at the bottom of the income distribution are more exposed to aggregate earnings risk in general, and to monetary policy shocks specifically. Income risk for the poor is almost entirely ‘extensive’, or due to cyclical fluctuations in labor market transitions, through procyclical job-finding and countercyclical separation rates. At higher incomes, in contrast,‘intensive’risk, from fluctuating income growth in continued employment, accounts for half of cyclical movements in income risk.
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hal-04489790 , version 1 (05-03-2024)

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  • HAL Id : hal-04489790 , version 1

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Tobias Broer, John Kramer, Kurt Mitman. The curious incidence of shocks along the income distribution. Mimeo, Institute for International Economic Studies, Stockholm University, 2020. ⟨hal-04489790⟩
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