All that Glitters Is not Gold. Effects of Working from Home on Income Inequality at the Time of COVID-19

39 Pages Posted: 11 May 2020 Last revised: 1 Jun 2020

See all articles by Luca Bonacini

Luca Bonacini

Università degli studi di Modena e Reggio Emilia (UNIMORE)

Giovanni Gallo

National Institute for Public Policies Analysis (INAPP); University of Modena and Reggio Emilia

Sergio Scicchitano

Istituto Nazionale per l’Analisi delle Politiche Pubbliche (INAPP); Global Labor Organization (GLO)

Date Written: May 8, 2020

Abstract

The recent global COVID-19 pandemic forced most of governments in developed countries to introduce severe measures limiting people mobility freedom in order to contain the infection spread. Consequently, working from home (WFH) procedures became of great importance for a large part of employees, since they represent the only option to both continue working and keep staying home. Based on influence function regression methods, our paper explores the role of WFH attitude across labour income distribution in Italy. Results show that increasing WFH attitudes of occupations would lead to a rise of wage inequality among Italian employees. Specifically, a change from low to high WFH attitude would determine a 10% wage premium on average and even higher premiums (+17%) in top deciles of wage distribution. A possible improvement of occupations WFH attitude tends to benefit male, older and high-paid employees, as well as those living in provinces more affected by the novel coronavirus.

Keywords: COVID-19, coronavirus, working from home, smart working, inequality, unconditional quantile regressions, RIF

JEL Classification: D31, J31, I24

Suggested Citation

Bonacini, Luca and Gallo, Giovanni and Scicchitano, Sergio, All that Glitters Is not Gold. Effects of Working from Home on Income Inequality at the Time of COVID-19 (May 8, 2020). Available at SSRN: https://ssrn.com/abstract=3597996 or http://dx.doi.org/10.2139/ssrn.3597996

Luca Bonacini

Università degli studi di Modena e Reggio Emilia (UNIMORE) ( email )

Viale A. Allegri 9
Modena, Modena 42121
Italy

Giovanni Gallo

National Institute for Public Policies Analysis (INAPP) ( email )

Corso d'Italia 33
Rome, 00198
Italy

University of Modena and Reggio Emilia

Via Jacopo Berengario 51
Department of Economics Marco Biagi
Modena, Modena 41121
Italy

Sergio Scicchitano (Contact Author)

Istituto Nazionale per l’Analisi delle Politiche Pubbliche (INAPP) ( email )

Corso d’Italia, 33
Roma, 00198
Italy

Global Labor Organization (GLO) ( email )

Collogne
Germany

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