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Why do wages vary among employers?

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  • Erica L. Groshen

Abstract

A review of empirical evidence on intra- and interindustry wage differentials among industries and establishments, presenting five alternative explanations for large and persistent variance in wages across employers, as well as policy implications for the alternatives.

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File URL: http://www.clevelandfed.org/research/review/1988/88-q1-groshen.pdf
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Bibliographic Info

Article provided by Federal Reserve Bank of Cleveland in its journal Economic Review.

Volume (Year): (1988)
Issue (Month): Q I ()
Pages: 19-38

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Handle: RePEc:fip:fedcer:y:1988:i:qi:p:19-38:n:v.24no.1

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Keywords: Wages ; Labor market;

References

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  1. William T. Dickens & Kevin Lang, 1985. "A Test of Dual Labor Market Theory," NBER Working Papers 1314, National Bureau of Economic Research, Inc.
  2. Robert S. Smith & Ronald G. Ehrenberg, 1983. "Estimating Wage-Fringe Trade-Offs: Some Data Problems," NBER Chapters, in: The Measurement of Labor Cost, pages 347-370 National Bureau of Economic Research, Inc.
  3. Ronald G. Ehrenberg & George T. Milkovich, 1987. "Compensation and Firm Performance," NBER Working Papers 2145, National Bureau of Economic Research, Inc.
  4. Brown, Charles, 1980. "Equalizing Differences in the Labor Market," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 94(1), pages 113-34, February.
  5. Bengt Holmstrom, 1980. "Equilibrium Long-Term Labor Contracts," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 414R, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  6. Venables, Anthony J, 1983. "Random Job Prospects and the Distribution of Income," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 98(4), pages 637-57, November.
  7. Robert S. Smith, 1979. "Compensating wage differentials and public policy: A review," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 32(3), pages 339-362, April.
  8. William T. Dickens & Lawrence F. Katz, 1986. "Interindustry Wage Differences and Industry Characteristics," NBER Working Papers 2014, National Bureau of Economic Research, Inc.
  9. Rothschild, Michael & Stiglitz, Joseph E, 1976. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 90(4), pages 630-49, November.
  10. Nolan, Peter & Brown, William, 1983. "Competition and Workplace Wage Determination," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 45(3), pages 269-87, August.
  11. Richard A. Lester, 1952. "A range theory of wage differentials," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 5(4), pages 483-500, July.
  12. John M. Abowd, 1987. "Collective Bargaining and the Division of the Value of the Enterprise," NBER Working Papers 2137, National Bureau of Economic Research, Inc.
  13. James A. Dalton & E. J. Ford & Jr, 1977. "Concentration and labor earnings in manufacturing and utilities," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 31(1), pages 45-60, October.
  14. William T. Dickens & Kevin Lang, 1986. "Labor Market Segmentation and the Union Wage Premium," NBER Working Papers 1883, National Bureau of Economic Research, Inc.
  15. Azariadis, Costas, 1983. "Employment with Asymmetric Information," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 98(3), pages 157-72, Supplemen.
  16. Bulow, Jeremy I & Summers, Lawrence H, 1986. "A Theory of Dual Labor Markets with Application to Industrial Policy,Discrimination, and Keynesian Unemployment," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 4(3), pages 376-414, July.
  17. Leonard, Jonathan S, 1987. "Carrots and Sticks: Pay, Supervision, and Turnover," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 5(4), pages S136-52, October.
  18. Miller, Edward, 1981. "Variation of wage rates with size of establishment," Economics Letters, Elsevier, Elsevier, vol. 8(3), pages 281-286.
  19. Lang, Kevin, 1991. "Persistent Wage Dispersion and Involuntary Unemployment," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 106(1), pages 181-202, February.
  20. Pugel, Thomas A, 1980. "Profitability, Concentration and the Interindustry Variation in Wages," The Review of Economics and Statistics, MIT Press, vol. 62(2), pages 248-53, May.
  21. 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.
  22. Wachter, Michael L, 1970. "Cyclical Variation in the Interindustry Wage Structure," American Economic Review, American Economic Association, American Economic Association, vol. 60(1), pages 75-84, March.
  23. William T. Dickens, 1986. "Wages, Employment and the Threat of Collective Action by Workers," NBER Working Papers 1856, National Bureau of Economic Research, Inc.
  24. Kevin Lang & William T. Dickens, 1987. "Neoclassical and Sociological Perspectives on Segmented Labor Markets," NBER Working Papers 2127, National Bureau of Economic Research, Inc.
  25. Erica L. Groshen, 1988. "Sources of wage dispersion: the contribution of interemployer differentials within industry," Working Paper 8802, Federal Reserve Bank of Cleveland.
  26. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, American Economic Association, vol. 74(3), pages 433-44, June.
  27. William T. Dickens & Kevin Lang, 1985. "Testing Dual Labor Market Theory: A Reconsideration of the Evidence," NBER Working Papers 1670, National Bureau of Economic Research, Inc.
  28. Rosen, Sherwin, 1969. "On the Interindustry Wage and Hours Structure," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 77(2), pages 249-73, March/Apr.
  29. Randall K. Filer, 1983. "Sexual Differences in Earnings: The Role of Individual Personalities and Tastes," Journal of Human Resources, University of Wisconsin Press, vol. 18(1), pages 82-99.
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