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Do recruitment ties affect wages? An analysis using matched employer-employee data from Vietnam

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Author Info

  • Anna Folke Larsen

    ()
    (Department of Economics, University of Copenhagen)

  • John Rand

    ()
    (Institute of Food and Resource Economics, University of Copenhagen)

  • Nina Torm

    ()
    (Department of Economics, University of Copenhagen)

Abstract

This paper examines the extent to which recruitment ties affect individual wage outcomes in small and medium scale manufacturing firms. Based on a unique matched employer-employee dataset from Vietnam we find that there is a significant positive wage premium associated with obtaining a job through an informal contact, when controlling for standard determinants of wage compensation. Moreover, we show that the mechanism through which informal contacts affect wages depends on the type of recruitment tie used. The findings are robust across location, firm size categories and different worker types.

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File URL: http://okonomi.foi.dk/workingpapers/WPpdf/WP2011/WP_2011_4_recruitment_ties_wages.pdf
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Bibliographic Info

Paper provided by University of Copenhagen, Department of Food and Resource Economics in its series IFRO Working Paper with number 2011/4.

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Length: 23 pages
Date of creation: Jan 2011
Date of revision:
Handle: RePEc:foi:wpaper:2011_4

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Web page: http://www.ifro.ku.dk/
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Keywords: Wages; Recruitment ties; Vietnam;

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References

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  1. Abowd, John M. & Kramarz, Francis, 1999. "The analysis of labor markets using matched employer-employee data," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 40, pages 2629-2710 Elsevier.
  2. Soderbom, Mans & Teal, Francis & Wambugu, Anthony, 2005. "Unobserved heterogeneity and the relation between earnings and firm size: evidence from two developing countries," Economics Letters, Elsevier, vol. 87(2), pages 153-159, May.
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Cited by:
  1. Vinod Mishra & Russell Smyth, 2012. "Returns to Schooling in Urban China: New Evidence Using Heteroskedasticity Restrictions to Obtain Identification Without Exclusion Restrictions," Development Research Unit Working Paper Series 33-12, Monash University, Department of Economics.
  2. Vu, Van Huong, 2012. "Does export participation affect wages and employment quality? the case of Vietnamese SMEs," MPRA Paper 38696, University Library of Munich, Germany.
  3. Huong Vu & Steven Lim & Mark Holmes & Tinh Doan, 2013. "Firm Exporting and Employee Benefits: First Evidence from Vietnam Manufacturing SMEs," Economics Bulletin, AccessEcon, vol. 33(1), pages 519-535.
  4. Benedikter, Simon & Waibel, Gabi & Birtel, Serge & Bui, Cuong The & Tran, Be Thanh, 2013. "Local Entrepreneurship in Vietnam’s Rural Transformation. A Case Study from the Mekong Delta," MPRA Paper 49866, University Library of Munich, Germany.
  5. Rand, John & Torm, Nina, 2012. "The Benefits of Formalization: Evidence from Vietnamese Manufacturing SMEs," World Development, Elsevier, vol. 40(5), pages 983-998.

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