Changes in the Finnish Wage Structure: Will Demand and Supply Do?

This study addresses changes in the wage structure in Finland between 1977 and 1995, and provides a simple explanation based on the demand for and supply of skills. The single index model of Card and Lemieux (1996) is augmented by incorporating changes in the supply of skills. The augmented model adequately accounts for the changes in relative wages between groups of different education and experience, but does not capture the changes in the within-group distribution.
JEL classification : J 31