Welcome to a CEDAR seminar with Jonatan Andersson, Department of Economic History, Uppsala University.
Firm premiums and the great compression: Evidence from a worker-employer linked database for Stockholm during the postwar period
During the postwar period, wage and income inequality declined dramatically in the Western world. Notably, Sweden transitioned from high levels of income inequality to becoming known as the world's most equal country. This project studies the role of firms and workers in this process. Using a machine-learning approach, we aim to construct a unique database containing individual-level data on income, firms, and addresses for Stockholm's population annually from 1940 to 1970 from combined tax and population registers. With this database, we can study how the income distribution evolved for employees within and between all companies in Stockholm and what drove this development.
We investigate three aspects related to the core investigation. First, the postwar period saw low unemployment rates, which strengthened workers’ bargaining power. This shift led to increased worker turnover rates and, allegedly, higher wages. We analyze this phenomenon using our linked worker-employer dataset. Second, today’s rising income inequality is largely driven by growing disparities in compensation between workers at different workplaces. We investigate whether the postwar period showed the opposite trend—declining workplace heterogeneity among workers. Third, the role of infrastructure investments in facilitating workplace mobility during the postwar period. We address this question by examining the 1950s rollout of the Stockholm metro and its impact on labor market outcomes for residents living close to and far from the metro stations.
All interested are welcome to participate. If you want to participate digitally, please contact Mojgan to receive a meeting link.
