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Changes in Managerial Pay Structures 1986-1992 and Rising Returns to Skill

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  • O'Shaughnessy, K C
  • Levine, David I
  • Cappelli, Peter

Abstract

We examine the relationship between wages and skill requirements in a sample of over 50,000 managers in 39 companies between 1986 and 1992. The data include an unusually good measure of job requirements and skills that can proxy for human capital. We find that wage inequality increased both within and between firms from 1986 and 1992. Higher returns to our measure of skill accounts for most of the increasing inequality within firms. At the same time, our measure of skill does not explain much of the cross-sectional variance in average wages between employers, and changes in returns to skill do not explain any of the time series increase in between-firm variance over time. Copyright 2001 by Oxford University Press.

Suggested Citation

  • O'Shaughnessy, K C & Levine, David I & Cappelli, Peter, 2001. "Changes in Managerial Pay Structures 1986-1992 and Rising Returns to Skill," Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 482-507, July.
    • Handle: RePEc:oup:oxecpp:v:53:y:2001:i:3:p:482-507
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    19. repec:fth:prinin:377 is not listed on IDEAS
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    Cited by:

    1. Kuenn, A.C. & Meng, C.M. & Peters, Z. & Verhagen, A.M.C., 2013. "Competencies: requirements and acquisition," ROA Report 006, Maastricht University, Research Centre for Education and the Labour Market (ROA).
    2. Hans Heijke & Christoph Meng & Ger Ramaekers, 2003. "An investigation into the role of human capital competences and their pay‐off," International Journal of Manpower, Emerald Group Publishing Limited, vol. 24(7), pages 750-773, November.
    3. Schüssler, Reinhard & Seidel, Christian, 2010. "Gale Shapley auf dem Arbeitsmarkt," EconStor Preprints 55829, ZBW - Leibniz Information Centre for Economics.
    4. Emanuela Ciapanna & Marco Taboga & Eliana Viviano, 2015. "Sectoral differences in managers’ compensation: insights from a matching model," Temi di discussione (Economic working papers) 1000, Bank of Italy, Economic Research and International Relations Area.
    5. Mañé Vernet, Ferran & Miravet, Daniel, 2010. "An investigation on the pay-off to generic competences for core employees in Catalan manufacturing firms," Working Papers 2072/179595, Universitat Rovira i Virgili, Department of Economics.

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    More about this item

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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