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An Intra-Firm Perspective on Wage Profiles and Employment of Older Workers with Special Reference to Human Capital and Deferred Compensation

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Author Info
Pfeifer, Christian

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Abstract

Human capital and deferred compensation might explain why firms employ but do not hire older workers. Adjustments of wage-tenure profiles for older new entrants are explored in the context of deferred compensation. From an equity theory perspective, such adjustments might lead to adverse incentive effects so that firms prefer to hire rather homogenous workers in terms of entry age. A personnel data set is analyzed which reveals that at least for white-collar workers entry age has a positive effect on entry wages and wage-tenure profiles are adjusted according to entry age.

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Publisher Info
Paper provided by Universität Hannover, Wirtschaftswissenschaftliche Fakultät in its series Diskussionspapiere der Wirtschaftswissenschaftlichen Fakultät der Universität Hannover with number dp-413.

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Length: 86 pages
Date of creation: Feb 2009
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Handle: RePEc:han:dpaper:dp-413

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Related research
Keywords: deferred compensation; human capital; internal labor markets; older workers; wages;

Find related papers by JEL classification:
J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
M51 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Firm Employment Decisions; Promotions
M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects

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