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Firm-Size Wage Gaps, Job Responsibility, and Hierarchical Matching

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  • Jeremy T. Fox

Abstract

I present the fact that wage gaps due to firm size increase with job responsibility. I use Swedish data to determine whether wage gaps increase with a direct measure of job responsibility, to compare the age patterns of the wage gaps for blue- and white-collar workers, and to compare wages by job responsibility and spans of control. With U.S. data, I compare supervisory to nonsupervisory occupations and find that wage gaps increase with job responsibility for most occupational ladders. This fact is consistent with hierarchical matching models in which the larger number of subordinates amplifies managerial talent. (c) 2009 by The University of Chicago.

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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 27 (2009)
Issue (Month): 1 (01)
Pages: 83-126

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Handle: RePEc:ucp:jlabec:v:27:y:2009:i:1:p:83-126

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Web page: http://www.journals.uchicago.edu/JOLE/

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Cited by:
  1. Bengtsson, Ola & Hand, John R. M., 2012. "Employee Compensation in Entrepreneurial Companies," Working Paper Series 922, Research Institute of Industrial Economics.
  2. Akar, Gizem & Balkan, Binnur & Tumen, Semih, 2014. "Overview of Firm-Size and Gender Pay Gaps in Turkey: The Role of Informal Employment," MPRA Paper 53835, University Library of Munich, Germany.
  3. Robertas Zubrickas, 2011. "Managerial accountability for payroll expense and firm-size wage effects," IEW - Working Papers 474, Institute for Empirical Research in Economics - University of Zurich.
  4. Akyol, Ali C. & Verwijmeren, Patrick, 2013. "Human capital costs, firm leverage, and unemployment rates," Journal of Financial Intermediation, Elsevier, vol. 22(3), pages 464-481.
  5. Hassink, Wolter & Russo, Giovanni, 2010. "The Glass Door: The Gender Composition of Newly-Hired Workers Across Hierarchical Job Levels," IZA Discussion Papers 4858, Institute for the Study of Labor (IZA).
  6. Feng, Shuaizhang, 2009. "Return to Training and Establishment Size: A Reexamination of the Size-Wage Puzzle," IZA Discussion Papers 4143, Institute for the Study of Labor (IZA).
  7. Valerie Smeets & Michael Waldman & Frederic Warzynski, 2013. "Performance, Career Dynamics, and Span of Control," Economics Working Papers 2013-02, School of Economics and Management, University of Aarhus.
  8. Rui Baptista & Francisco Lima & Miguel Preto, 2013. "Entrepreneurial skills and workers’ wages in small firms," Small Business Economics, Springer, vol. 40(2), pages 309-323, February.
  9. Friedhelm Pfeiffer & Nico Schulz, 2012. "Gregariousness, interactive jobs and wages," Journal of Labour Market Research, Springer, vol. 45(2), pages 147-159, July.

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