Global earnings inequality down, within-country inequality increasing

The question of how contacts affect job opportunities has long been a subject of debate. A new study by Marcus Eliason, Lena Hensvik, Francis Kramarz, and Oskar Nordström Skans sheds new light on the issue. The results challenge the perception that social contacts reinforce inequality in the labor market by primarily benefiting high-income individuals who have contacts in other high-paying firms. However, the study finds no evidence to support this notion. Instead, it reveals that contacts are more important for low-wage firms, which hire people from various income levels. Therefore, there are indications that job placements through contacts are actually more equal than traditional, more formal search methods, as such recruitments involve greater movement between income levels.

A lot of research investigates how parental leave affects parents' careers, women's and children's health, and how it is divided between the parents. However, less is known about how parental leave programs affect companies, which is an important question since increased parental leave can make it more expensive to hire women and affect companies' profits and competitiveness negatively. In a new study, researchers Arizo Karimi, Rita Ginja, and Pengpeng Xiao investigate how companies reacted after two Swedish parental leave reforms that extended the duration of paid leave.

This article is published in The Economic Journal
Authors: Olle Hammar and Daniel Waldenström