Advanced Search
MyIDEAS: Login to save this paper or follow this series

Return to Training and Establishment Size: A Reexamination of the Size-Wage Puzzle

Contents:

Author Info

  • Feng, Shuaizhang

    ()
    (Shanghai University of Finance and Economics)

Registered author(s):

    Abstract

    The paper reexamines the employer size-wage puzzle using NLSY79 data. The empirical results show that even for those who never receive any training from their employers, size-wage premium still exists and is quantitatively important. Wage increases associated with receiving on-the-job training are less in large establishments than in small ones. In addition, there is no evidence that starting wages in large establishments are lower than in small establishments. Theories that explain the size-wage puzzle using training and other endogenous productivity differences are not consistent with these new findings.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://ftp.iza.org/dp4143.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4143.

    as in new window
    Length: 37 pages
    Date of creation: Apr 2009
    Date of revision:
    Handle: RePEc:iza:izadps:dp4143

    Contact details of provider:
    Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
    Phone: +49 228 3894 223
    Fax: +49 228 3894 180
    Web page: http://www.iza.org

    Order Information:
    Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
    Email:

    Related research

    Keywords: size-wage premium; return to training; establishment size;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    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.:
    as in new window
    1. Jacob Mincer, 1988. "Job Training, Wage Growth, and Labor Turnover," NBER Working Papers 2690, National Bureau of Economic Research, Inc.
    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.
    3. Lynch, Lisa M, 1992. "Private-Sector Training and the Earnings of Young Workers," American Economic Review, American Economic Association, vol. 82(1), pages 299-312, March.
    4. Mellow, Wesley, 1982. "Employer Size and Wages," The Review of Economics and Statistics, MIT Press, vol. 64(3), pages 495-501, August.
    5. Alan Manning & Ted To, 2002. "Oligopsony and Monopsonistic Competition in Labor Markets," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 155-174, Spring.
    6. Brown, James N, 1989. "Why Do Wages Increase with Tenure? On-the-Job Training and Life-Cycle Wage Growth Observed within Firms," American Economic Review, American Economic Association, vol. 79(5), pages 971-91, December.
    7. Robert Gibbons & Lawrence F. Katz, 1989. "Does Unmeasured Ability Explain Inter-Industry Wage Differentials?," NBER Working Papers 3182, National Bureau of Economic Research, Inc.
    8. Green, Francis & Machin, Stephen & Manning, Alan, 1996. "The Employer Size-Wage Effect: Can Dynamic Monopsony Provide an Explanation?," Oxford Economic Papers, Oxford University Press, vol. 48(3), pages 433-55, July.
    9. Jeremy T. Fox, 2009. "Firm-Size Wage Gaps, Job Responsibility, and Hierarchical Matching," Journal of Labor Economics, University of Chicago Press, vol. 27(1), pages 83-126, 01.
    10. Jonathan R. Veum, 1995. "Sources of training and their impact on wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 48(4), pages 812-826, July.
    11. Brown, Charles & Medoff, James, 1989. "The Employer Size-Wage Effect," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1027-59, October.
    12. Shouyong Shi, 1998. "Product Market and the Size-Wage Differential," Working Papers 972, Queen's University, Department of Economics.
    13. Kenneth R Troske, 1994. "Evidence on the Employer Size-Wage Premium From Worker-Establishment Matched Data," Working Papers 94-10, Center for Economic Studies, U.S. Census Bureau.
    14. Idson, Todd L & Feaster, Daniel J, 1990. "A Selectivity Model of Employer-Size Wage Differentials," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 99-122, January.
    15. Burdett, Kenneth & Mortensen, Dale T, 1998. "Wage Differentials, Employer Size, and Unemployment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(2), pages 257-73, May.
    16. Oi, Walter Y. & Idson, Todd L., 1999. "Firm size and wages," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 33, pages 2165-2214 Elsevier.
    17. repec:fth:coluec:512 is not listed on IDEAS
    18. Barron, John M & Berger, Mark C & Black, Dan A, 1997. "How Well Do We Measure Training?," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages 507-28, July.
    19. Barron, John M & Black, Dan A & Loewenstein, Mark A, 1987. "Employer Size: The Implications for Search, Training, Capital Investment, Starting Wages, and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 5(1), pages 76-89, January.
    20. John Gibson & Steven Stillman, 2009. "Why Do Big Firms Pay Higher Wages? Evidence from an International Database," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 213-218, February.
    21. Harley Frazis & Mark A. Loewenstein, 2005. "Reexamining the Returns to Training: Functional Form, Magnitude, and Interpretation," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
    22. Luojia Hu, 2003. "The hiring decisions and compensation structures of large firms," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(4), pages 663-681, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Facundo Sepulveda & Fabio Mendez, 2011. "The cyclicality of skill acquisition: evidence from panel data," CAMA Working Papers 2011-13, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4143. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.