The impact of wage increases on job satisfaction is explored. First, it is empirically confirmed that current job satisfaction rises with the absolute wage level as well as with wage increases. Second, a basic job satisfaction function is constructed based on the empirical results, and theoretical implications are analyzed. Myopic maximization of such a function directly implies increasing and concave shaped wage profiles. It is shown that employees get unhappier over time staying on a certain job although wages increase, which again is empirically confirmed.
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Paper provided by University of Bonn, Germany in its series Bonn Econ Discussion Papers with number
bgse1_2003.
Length: 25 Date of creation: Jan 2003 Date of revision: Handle: RePEc:bon:bonedp:bgse1_2003
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Find related papers by JEL classification: M54 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Labor Management J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General M12 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Personnel Management; Executive Compensation
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Chiappori, P.A. & Salanie, B. & Valentin, J., 1996.
"Early Starters Versus Late Beginners,"
Papers
9623, Institut National de la Statistique et des Etudes Economiques-.
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