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Job Satisfaction, Wage changes and Quits: Evidence from Germany

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  • Andrew Clark
  • Yannis Georgellis
  • Peter Sanfey

Abstract

This paper uses data from ten waves of the German Socio-Economic Panel to examine the effect of wages and job satisfaction on workers' future quit behaviour. Our results show that workers who report dissatisfaction with their jobs are statistically more likely to quit than those with higher levels of satisfaction. The cross-sectional distribution of job satisfaction responses thus contains information which enables us to predict workers' future behaviour. This result is remarkably robust to specification changes, and to estimation methods that account explicitly for unobserved heterogeneity. We find some evidence for males that wage changes are a better predictor of quits than wage levels, consistent with comparison effects stressed in the psychology literature.

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Bibliographic Info

Paper provided by Economics and Finance Section, School of Social Sciences, Brunel University in its series Economics and Finance Discussion Papers with number 98-06.

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Handle: RePEc:bru:bruedp:98-06

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Postal: Brunel University, Uxbridge, Middlesex UB8 3PH, UK

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