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Firm Size or Firm Age? The Effect on Wages Using Matched Employer-Employee Data

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  • Fredrik Heyman

Abstract

This paper uses matched employer-employee data set for Sweden to study the relationship between firm age and wages, systematically addressing a variety of possible explanations for observing a firm age-wage effect. Results show considerable heterogeneity across years, along segments of the firm age distribution and across industries. For 1995, a positive relationship is found between firm age and wages. This relationship is robust to inclusion of variables that might affect results. Taking into account that larger firms are also older firms, results show that inclusion of firm age does not alter the positive effect of firm size on wages. Copyright 2007 The Author; Journal compilation 2007 CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing Ltd..

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Bibliographic Info

Article provided by CEIS in its journal LABOUR.

Volume (Year): 21 (2007)
Issue (Month): 2 (06)
Pages: 237-263

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Handle: RePEc:bla:labour:v:21:y:2007:i:2:p:237-263

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Cited by:
  1. Peter Thompson & Mihaela Pintea, 2008. "Sorting, Selection, and Industry Shakeouts," Review of Industrial Organization, Springer, vol. 33(1), pages 23-40, August.
  2. Emin Dinlersoz & Henry Hyatt & Sang Nguyen, 2011. "Wage Dynamics along the Life-Cycle of Manufacturing Plants," Working Papers 11-24r, Center for Economic Studies, U.S. Census Bureau, revised Mar 2013.
  3. Øivind A. Nilsen & Arvid Raknerud & Terje Skjerpen, 2011. "Using the Helmert-transformation to reduce dimensionality in a mixed model: An application to a wage equation with worker and firm heterogeneity," Discussion Papers 667, Research Department of Statistics Norway.
  4. Nyström, Kristina & Elvung, Gulzat Zhetibaeva, 2013. "New firms and labor market entrants: Is there a wage penalty for employment in new firms?," Working Paper Series in Economics and Institutions of Innovation 319, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  5. Nilsen, Øivind Anti & Raknerud, Arvid & Skjerpen, Terje, 2011. "Using the Helmert-transformation to reduce dimensionality in a mixed model: Application to a wage equation with worker and firm heterogeneity," Discussion Paper Series in Economics 11/2011, Department of Economics, Norwegian School of Economics, revised 04 Oct 2011.
  6. Antoni, Manfred & Janser, Markus & Lehmer, Florian, 2014. "The hidden winners of renewable energy promotion : insights into sector-specific wage differentials," IAB Discussion Paper 201412, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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