@TechReport{iza:izadps:dp11091, author={Gomes, Pedro Maia}, title={Heterogeneity and the Public Sector Wage Policy}, year={2017}, month={Oct}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={11091}, url={https://www.iza.org/publications/dp11091}, abstract={A model with search and matching frictions and heterogeneous workers was established to evaluate a reform of the public sector wage policy in steady-state. The model was calibrated to the UK economy based on Labour Force Survey data. A review of the pay received by all public sector workers to align the distribution of wages with the private sector reduces steady-state unemployment by 1.4 percentage points.}, keywords={public sector wage premium;public sector wages;public sector employment;unemployment;skilled workers;worker heterogeneity}, }