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Cohort Effects and Returns to Seniority in France

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  • David N. MARGOLIS

Abstract

We examine empirically returns to seniority in France and estimate cohort effects in both firm specific compensation policies and returns to job seniority. We demonstrate the biases in several estimators of returns to seniority and show that allowing firm specific compensation policies and returns to seniority to vary by entry cohort uncovers patterns of variance within firm and within cohort in estimated intercepts and slopes that can be explained by no single theory.

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Bibliographic Info

Article provided by ENSAE in its journal Annals of Economics and Statistics.

Volume (Year): (1996)
Issue (Month): 41-42 ()
Pages: 443-464

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Handle: RePEc:adr:anecst:y:1996:i:41-42:p:18

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  1. Katharine G. Abraham & Henry S. Farber, 1986. "Job Duration, Seniority and Earnings," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 407, Massachusetts Institute of Technology (MIT), Department of Economics.
  2. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 87(5), pages 972-90, October.
  3. Milton Harris & Bengt Holmstrom, 1981. "A Theory of Wage Dynamics," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 488, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  4. MacLeod, W Bentley & Malcomson, James M, 1988. "Reputation and Hierarchy in Dynamic Models of Employment," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 96(4), pages 832-54, August.
  5. John M. Abowd & Francis Kramarz & David N. Margolis, 1994. "High-Wage Workers and High-Wage Firms," CIRANO Working Papers, CIRANO 94s-23, CIRANO.
  6. Topel, Robert H, 1991. "Specific Capital, Mobility, and Wages: Wages Rise with Job Seniority," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(1), pages 145-76, February.
  7. Gary S. Becker, 1975. "Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education, 2nd ed," NBER Books, National Bureau of Economic Research, Inc, National Bureau of Economic Research, Inc, number beck75-1.
  8. Altonji, Joseph G & Shakotko, Robert A, 1987. "Do Wages Rise with Job Seniority?," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 54(3), pages 437-59, July.
  9. Beaudry, Paul & DiNardo, John, 1991. "The Effect of Implicit Contracts on the Movement of Wages over the Business Cycle: Evidence from Micro Data," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(4), pages 665-88, August.
  10. Salop, Joanne & Salop, Steven, 1976. "Self-Selection and Turnover in the Labor Market," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 90(4), pages 619-27, November.
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