Productivity Dispersion Faster at the Bottom

From Voxeu, a new paper on wages and productivity:

"the dispersion [within sectors and countries] of both wages and productivity has been faster at the bottom than at the top,” using data from AUS, AUT, BEL, CHL, DNK, FIN, FRA, HUN, ITA, JPN, NLD, NOR, NZL, SWE. 

They conclude: “Using firm-level data, we show that wage dispersion and productivity dispersion have both increased within sectors, and that these two increases are linked. This is particularly evident in sectors that are more open to trade and are more ICT-intensive. As would be expected, wage-setting institutions [in particular, the degree of centralization of wage bargaining] affect the distribution of wages, but our work shows that they also have an indirect effect by affecting the link between productivity and wage dispersion."