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Do Smaller Firms Pay Less in the Caribbean? The Case of Trinidad and Tobago

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  • Miguel Marcelle
  • Eric Strobl

Abstract

This article constitutes the first study of the employer size wage effect for a Caribbean country, namely the Republic of Trinidad and Tobago. Using a rich micro-level data set we estimate the firm size wage premium in an empirical model of wage determination. Despite exploring a variety of theories, samples, estimation techniques and tests, we find that, consistent with the empirical literature, larger firms in Trinidad and Tobago pay higher wages than smaller firms, for equally productive workers.

Suggested Citation

  • Miguel Marcelle & Eric Strobl, 2003. "Do Smaller Firms Pay Less in the Caribbean? The Case of Trinidad and Tobago," Journal of Development Studies, Taylor & Francis Journals, vol. 39(5), pages 181-198.
    • Handle: RePEc:taf:jdevst:v:39:y:2003:i:5:p:181-198
    DOI: 10.1080/00220380412331333199
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    References listed on IDEAS

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    1. Steven B. Caudill & Charles O. Kroncke & Franklin G. Mixon, 2021. "Is there a firm size‐wage gap after economic transition? – An examination of for‐profit and not‐for‐profit firms in Estonia," LABOUR, CEIS, vol. 35(4), pages 435-449, December.
    2. Nielsen, Ingrid & Smyth, Russell, 2008. "Who bears the burden of employer compliance with social security contributions? Evidence from Chinese firm level data," China Economic Review, Elsevier, vol. 19(2), pages 230-244, June.
    3. El Badaoui, Eliane & Strobl, Eric & Walsh, Frank, 2010. "The formal sector wage premium and firm size," Journal of Development Economics, Elsevier, vol. 91(1), pages 37-47, January.
    4. Eric Strobl & Robert Thornton, 2004. "Do Large Employers Pay More? The Case Of Five Developing African Countries," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 29(1), pages 137-161, June.
    5. Strobl, Eric & Thornton, Robert, 2002. "Do Large Employers Pay More in Developing Countries? The Case of Five African Countries," IZA Discussion Papers 660, Institute of Labor Economics (IZA).

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