Matteo Targa

J. König, M. Longmuir, J.Seebauer, M. Targa; The Scarring Effects of Firm Shutdowns on Workers’ Wages: A Distributional Perspective

Latest Version

Abstract: To shed light on the differential impact of firm shutdowns across the distribution of workers, we adopt the wage determination framework of Bonhomme, Lamadon, and Manresa (2019) to uncover workers’ unobserved types. Worker types relate to workers’ position in the wage distribution: all else equal, a higher type implies higher wages. We use the universe of social security records of Italy’s Veneto region, one of the leading Italian regional economies, from 1975 to 2001. Based on this rich matched employer-employee data, we measure wage losses after firm shutdowns for different worker types using an event-study framework. Aggregate wage losses directly after a shutdown are 4.5% of the daily wage, which almost halves after six years. This aggregate trajectory masks stark heterogeneity: top-type workers face initiallosses of 12.4%, which remain persistent even after six years. Conversely, initial losses forbottom-type workers are 2.6%, which become statistically insignificant after six years. We identify losses in firm tenure as the main source of wage reductions following the shutdownof a worker’s firm. Finally, we show that the AKM model (Abowd, Kramarz, and Margolis, 1999), the current workhorse model of wage determination, does not capture this heterogeneity and can lead to misleading conclusions regarding the sources of wage losses 

L. Braunschweig, J. Seebauer, M. Targa;  The Role of Industries, Occupations and Firms in the Evolution of Wage Inequality

Draft available upon request.

Abstract: This paper examines the evolution of wage inequality in Germany from 1985 to 2020. To capture the heterogeneity in wage dynamics, we distinguish worker wages across 265 industrial sectors and four task-based occupational classes, yielding 993 industry-by-occupation cells that can be consistently observed over the 35-year period. During this time, total wage variance increased by 9 log points, with half of the rise driven by widening differences between 22 cells. These comprise either non-routine abstract workers in high-tech industries or non-routine manual workers in low-paying retail sectors. The central role of these 22 key cells in explaining the overall increase in wage inequality reflects a combination of strong employment concentration, rising polarization in relative earnings, and increased assortative matching.

M. Longmuir C. Schröder, M. Targa;  De-routinization of Jobs and the Distribution of Earnings: A Cross-Country Comparison 

R&R stage. 

Abstract: In this study, we use a novel dataset covering 35 countries to investigate the phenomenon of job de-routinization, job polarization, and their potential ramifications on earnings distributions. We find strong empirical evidence of job polarization, but no systematic link between job polarization and the distribution of earnings. We show that this missing link stems from the fact that occupational classes are not very strongly stratified along the earning distribution.

Earlier version available as LIS Working papers 796, LIS Cross-National Data Center in Luxembourg.  

F. Disslbacher, S. Morelli, and Matteo Targa; Wealth Inequality Trends Around the World: a first view from the GC Wealth Project data.

R&R stage. 

Abstract: Using the novel GC Wealth Project Data warehouse, this paper shows that most countries have experienced rising wealth inequality since the 1990s, with gains concentrated among the top 10\% and declines among the bottom 50\%. We reveal substantial variation of estimates across data sources and units of analysis which complicates international comparison of wealth inequality. Yet, core trends at the country level are generally robust. Individual-based series generally report higher inequality than household-based ones. Regional patterns reveal sharp increases in inequality in Latin America, North America, India, and China, while Europe and Asia-Pacific exhibit more stable trends. Incorporating Forbes billionaire data extends coverage to low-income countries and Africa—where, notably, billionaire wealth relative to GDP has remained stable, marking a distinct exception to global patterns.

GC Wealth Project team;  Wealth Composition, Distribution, and Transmission: The Graduate Center Wealth Project Data Warehouse.

Nature: Scientific Data (forthcoming) -  Link

Abstract: Private wealth, as well as its distribution and intergenerational transmission have become much-debated issues. However, existing evidence remains fragmented, context-dependent, and sometimes contested. This data descriptor introduces the Graduate Center (GC) Wealth Project data warehouse, a collection of databases covering multiple countries and time periods, designed to address these challenges. The data warehouse consolidates most existing evidence on private wealth and undertakes a significant data harmonization effort. We supplement each data point with extensive metadata on methodology. The data warehouse features an extensive collection of information on the household wealth levels and balance sheets, along with distributional statistics from a wide range of sources. Moreover, it draws together data on wealth transfer tax revenues, and tax features such as rates, exemption thresholds, and tax schedules. The broad range of data sources in the warehouse allows users to assess the degree of heterogeneity of estimates, and how methodological choices affect measurement outcomes. The new data series and policy indicators also allow extending quantitative analysis of wealth and public policy.

M. Targa;  Are “good” firms, good for all employees? An Investigation of Firm Fixed Effects at the Occupational Level.

Labour Economics, Volume 97, December 2025 -  Link

Abstract: This paper investigates whether employers share rents equally between white-collar and blue-collar workers. Using bias-corrected methods on administrative data from Italy’s Veneto region, I reject this null hypothesis. This finding has three main consequences. (1) High-type firms are not equally beneficial for all employees: half of the top 20% of firms for white-collar workers fall within the bottom 60% of the blue-collar distribution. (2) Recognizing this heterogeneity is important for accurately measuring worker-firm assortative matching. (3) Firm premium differentiation has a long history: employers steadily decreased rent sharing with their blue-collar workers since the late 1980s.

M. Targa, L. Yang;  The Impact of Communist Party Membership on Wealth Distribution and Accumulation in Urban China

World Development, Volume 181, September 2024 - Link

Media Coverage: The Economist (July 8th 2023), Stanford Center on China’s Economy and Institutions (January 15, 2025)

Abstract: This paper provides the first in-depth investigation into the evolution of the wealth gap between CCP and non-CCP households in urban China from 1995 to 2017. We apply unconditional quantile regression to analyze the variations in the premiums of party membership across the wealth distribution. Our results show that although the average wealth gap between CCP and non-CCP households remained substantial and consistent throughout the period, there have been significant shifts in the returns structure of party membership over time. Prior to the housing reform in the 1990s, the highest wealth premiums of CCP households were primarily concentrated in the middle of the distribution, but now they are concentrated at the bottom of the distribution. This is mainly attributed to the fact that CCP households at the lower end of the net wealth distribution are more inclined to possess housing assets, which tend to have higher value compared to those owned by non-CCP households. These effects fade out in the top half of the net wealth distribution, where the differences between CCP and non-CCP households become less apparent. Furthermore, by utilizing a balanced household panel from 2013 to 2017, we were able to track wealth accumulation at the household level. Our findings indicate that CCP households accumulate wealth faster than non-CCP households due to larger capital gains, and the differences between the two groups increase along the net wealth distribution.

J. Adriaans , M. Targa;   Gender Differences in Fairness Perceptions of Own Earnings in 28 European Countries.

European Societies (2023), 1-25. Link

Abstract: Women tend to evaluate their own pay more favorably than men. Contented women are speculated to not seek higher wages, thus the ‘paradox of the contented female worker’ may contribute to persistent gender pay differences. We extend the literature on gender differences in pay evaluations by investigating fairness evaluations of own earnings and underlying conceptions of fair earnings, providing a closer link to potential subsequent wage demands than previous literature. Using European Social Survey (2018/2019) data, we find no evidence that women evaluate their own earnings more favorably than men. In 15 out of the 28 analyzed countries, women actually report more intense levels of perceived unfairness. Studying fair markups on unfair earnings, i.e. the relative distance between the earnings received and earnings considered fair, we find that women report the same, if not lower, fair markups compared to men in most countries; thus indicating limited potential for perceived unfairness as a driving force to reduce the gender pay gap in Europe.