The Importance of Firms in Wage Determination

Arbeitspapier

Firms are central to many theories of the labor market. However, the extent to which firms affect wages has only recently been explored using matched employer-employee data. This paper investigates (i) the importance of firms in explaining wage differences across individuals and industries, and (ii) how the nature of interfirm mobility – job-to-job vs. jobunemployment- job – affects the relative importance of firms and workers in wage determination. Results indicate that (i) firms are much more important in explaining the variance of average wages across industries rather than individuals, and (ii) using job-to-job transitions reduces the importance of firm wage policies in explaining differences.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 1367

Classification and Topics

• Classification: Wirtschaft ; Wage Level and Structure; Wage Differentials ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
• Subject: interfirm mobility ; wage determination ; industry wage differentials ; matched employer employee data ; Lohnbildung ; Vergütungssystem ; Lohnstruktur ; Arbeitsmobilität ; Schätzung ; Österreich

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Gruetter, Max ; Lalive, Rafael
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2004

Further information

• Handle: http://hdl.handle.net/10419/20664
• Last update: 10.03.2025, 11:45 AM CET