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What Are the Factors Behind Pay Settlements? Evidence from Spanish and British Data

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Author Info
Bayo-Moriones, Alberto () (University of Navarra)
Galdón-Sánchez, José Enrique () (Universidad Pública de Navarra)
Martinez-de Moretin, Sara () (University of Navarra)

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Abstract

This article presents a study of the determinants of pay settlements in a sample of Spanish and British establishments. We find that variables such as establishment size and age, foreign ownership, labour costs, the existence of internal labour markets, a strategic approach to human resource management and pay setting institutions are related to the factors that shape pay adjustments. Moreover, our findings show that there are significant differences in the determinants of pay settlements between Spain and Great Britain. We suggest that the labour market institutions developed in each country influence pay setting decisions.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3401.

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Length: 38 pages
Date of creation: Mar 2008
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Handle: RePEc:iza:izadps:dp3401

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Related research
Keywords: compensation systems labor market institutions wage settlements establishment level data

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Find related papers by JEL classification:
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
J40 - Labor and Demographic Economics - - Particular Labor Markets - - - General

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  1. Donna Brown & Peter Ingram & Jonathan Wadsworth, 2004. "The Price is Right? Pay Settlements and Nominal Wage Rigidity in Britain," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 42(3), pages 507-525, 09. [Downloadable!] (restricted)
  2. Charles Brown & James L. Medoff, 2003. "Firm Age and Wages," Journal of Labor Economics, University of Chicago Press, vol. 21(3), pages 677-698, July. [Downloadable!]
  3. Cardoso, Ana Rute & Portugal, Pedro, 2003. "Bargained Wages, Wage Drift and the Design of the Wage Setting System," IZA Discussion Papers 914, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. Randall S. Schuler & Susan E. Jackson, 2005. "A Quarter-Century Review of Human Resource Management in the U.S.: The Growth in Importance of the International Perspective," Management Revue, Rainer Hampp Verlag, vol. 16(1), pages 11-35. [Downloadable!]
  5. Schmidt, Christoph M & Zimmermann, Klaus F, 1991. "Work Characteristics, Firm Size and Wages," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 705-10, November. [Downloadable!] (restricted)
    Other versions:
  6. Hall, Robert E, 1982. "The Importance of Lifetime Jobs in the U.S. Economy," American Economic Review, American Economic Association, vol. 72(4), pages 716-24, September. [Downloadable!] (restricted)
  7. John Forth, Alex Bryson & Alex Bryson, 2006. "The Theory and Practice of Pay Setting," NIESR Discussion Papers 285, National Institute of Economic and Social Research. [Downloadable!]
  8. Mahmood Arai, 2003. "Wages, Profits, and Capital Intensity: Evidence from Matched Worker-Firm Data," Journal of Labor Economics, University of Chicago Press, vol. 21(3), pages 593-618, July. [Downloadable!]
    Other versions:
  9. Juan Francisco Canal Domínguez & César Rodríguez Gutiérrez, 2004. "Collective Bargaining and Within-firm Wage Dispersion in Spain," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 42(3), pages 481-506, 09. [Downloadable!] (restricted)
  10. Jane Morton & W. S. Siebert, 2001. "Labour Market Regimes and Worker Recruitment and Retention in the European Union: Plant Comparisons," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 39(4), pages 505-528, December. [Downloadable!] (restricted)
  11. Kerstin Hamann & John Kelly, 2003. "The Domestic Sources of Differences in Labour Market Policies," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 41(4), pages 639-663, December. [Downloadable!] (restricted)
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