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Using establishment‐level data, we shed light on the sources of the changes in the structure of production, wages, and employment that have occurred over recent decades. Our findings are: (1) the between‐plant component of wage dispersion is an important and growing part of total wage dispersion; (2) much of the between‐plant increase in wage dispersion is within industries; (3) the between‐plant measures of wage and productivity dispersion have increased substantially over recent decades; and (4) a significant fraction of the rising dispersion in wages and productivity is accounted for by changes in the distribution of computer investment across plants.
Dunne et al. (2004) studied this question.