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Intrafirm information transfers and wages

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Author Info
Huizinga, H. (Tilburg University, Center for Economic Research)

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Abstract

Technical and other information may be a firm s most important asset. To benefit from its information, however, a firm has to reveal it to one or more employees. Better informed employees produce more, but at the same time they demand higher wages to prevent them from joining a business competitor or starting their own firm. This paper examines the strategic transfer of information by a firm to its employees over their employment lifes. Generally, the firm is shown to transfer additional information to its employees each period of the employment relationship, while wages rise accordingly. An implication of the model is that more senior workers are more productive and receive higher wages because they have better access to the firm s vital informati-on.

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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 18.

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Date of creation: 1996
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Handle: RePEc:dgr:kubcen:199618

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Web page: http://center.uvt.nl

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  1. Harris, Milton & Holstrom, Bengt, 1982. "A Theory of Wage Dynamics," Review of Economic Studies, Blackwell Publishing, vol. 49(3), pages 315-33, July. [Downloadable!] (restricted)
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  2. Carmichael, H Lorne, 1989. "Self-Enforcing Contracts, Shirking, and Life Cycle Incentives," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 65-83, Fall. [Downloadable!] (restricted)
  3. Hashimoto, Masanori & Raisian, John, 1985. "Employment Tenure and Earnings Profiles in Japan and the United States," American Economic Review, American Economic Association, vol. 75(4), pages 721-35, September. [Downloadable!] (restricted)
  4. Nash, John, 1953. "Two-Person Cooperative Games," Econometrica, Econometric Society, vol. 21(1), pages 128-140, April. [Downloadable!] (restricted)
  5. Lazear, Edward P, 1981. "Agency, Earnings Profiles, Productivity, and Hours Restrictions," American Economic Review, American Economic Association, vol. 71(4), pages 606-20, September. [Downloadable!] (restricted)
  6. Nickell, Stephen J, 1976. "Wage Structures and Quit Rates," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 17(1), pages 191-203, February. [Downloadable!] (restricted)
  7. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April. [Downloadable!] (restricted)
  8. Hashimoto, Masanori, 1981. "Firm-Specific Human Capital as a Shared Investment," American Economic Review, American Economic Association, vol. 71(3), pages 475-82, June. [Downloadable!] (restricted)
  9. Salop, Joanne & Salop, Steven, 1976. "Self-Selection and Turnover in the Labor Market," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 619-27, November. [Downloadable!] (restricted)
  10. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9. [Downloadable!] (restricted)
  11. Lorne Carmichael, 1981. "Firm-Specific Human Capital and Promotion Ladders," Working Papers 452, Queen's University, Department of Economics.
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  12. Hashimoto, Masanori & Raisian, John, 1992. "Employment Tenure and Earnings Profiles in Japan and the United States: Reply," American Economic Review, American Economic Association, vol. 82(1), pages 346-54, March.
  13. Lazear, Edward P, 1979. "Why Is There Mandatory Retirement?," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1261-84, December. [Downloadable!] (restricted)
  14. Joanne Salop & Steve Salop, 1976. "Self-selection and turnover in the labor market," Special Studies Papers 80, Board of Governors of the Federal Reserve System (U.S.).
  15. Walter Y. Oi, 1962. "Labor as a Quasi-Fixed Factor," Journal of Political Economy, University of Chicago Press, vol. 70, pages 538. [Downloadable!] (restricted)
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