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Who benefits from a job change: The dwarfs or the giants?

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Author Info
Pavlopoulos, Dimitris (CEPS/INSTEAD and University of Leuven)
Fouarge, Didier (Research Center for Education and the Labour Market (ROA))
Muffels, Ruud (Tilburg University, Department of Sociology)
Vermunt, Jeroen K. (Tilburg University, Department of Methodology and Statistics)

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Abstract

Empirical studies have shown that voluntary job-to-job changes have a positive effect on wage mobility. In this paper, we suggest that the impact of a job change on wage growth depends on the position in the wage distribution. Using panel data from the UK and Germany, we investigate the effect of employer changes and within-firm job changes on year-to-year wage mobility. We show that a change of employer results into a wage increase for the low-paid workers but not for the high-paid workers. Within-firm job changes produce, on average, moderate wage gains for the low-paid workers in the UK, but have no effect in Germany. Results on 3-year wage mobility are shown to be very similar to the results on year-to-year wage growth.

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Paper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2007-16.

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Length: 31 pages
Date of creation: Dec 2007
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Handle: RePEc:irs:iriswp:2007-16

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Related research
Keywords: low pay; high pay ; job mobility ; wage mobility;

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Corsini, Lorenzo, 2008. "Institutions, Technological Change and the Wage Differentials Between Skilled and Unskilled Workers: Theory and Evidence from Europe," IRISS Working Paper Series 2008-02, IRISS at CEPS/INSTEAD. [Downloadable!]
  2. Prejmerean, Mihaela Cornelia & Vasilache, Simona, 2008. "What's a university worth? Changes in the lifestyle and status of post-2000 European Graduates," IRISS Working Paper Series 2008-05, IRISS at CEPS/INSTEAD. [Downloadable!]
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