Wage Dispersion and Allocation of Jobs
AbstractThis paper use Swedish establishment-level panel data on job turnover and wages to test the hypothesis of a positive relation between job reallocation and wage compression as proposed by Bertola & Rogerson (1997). The effect of wage dispersion on job turnover is negative and significant in the manufacturing sector. The wage compression effect is stronger on job destruction than on job creation, suggesting that wages are more rigid downward than upward. For the service sector results are reversed. Further results include (i) a strong positive relationship between the industry share of temporary employees and job turnover and (ii) a negative relationship between the amount of working-time flexibility and job reallocation. The estimation method is industry fixed-effect models that control for sector heterogeneity.
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Bibliographic InfoPaper provided by Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 479.
Length: 23 pages
Date of creation: 22 Oct 2001
Date of revision:
Publication status: Published as Heyman, Fredrik, 'How Wage Compression Affects Job Turnover' in Journal of Labor Research, 2008, pages 11-26.
Contact details of provider:
Postal: The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden
Phone: +46-(0)8-736 90 00
Fax: +46-(0)8-31 01 57
Web page: http://www.hhs.se/
More information through EDIRC
Job creation and job destruction; Wage dispersion; Temporary employment contracts.;
Find related papers by JEL classification:
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-01-22 (All new papers)
- NEP-LAB-2002-01-22 (Labour Economics)
- NEP-LTV-2002-01-22 (Unemployment, Inequality & Poverty)
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