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The Wage Policy of Firms – Comparative Evidence for the U.S. and Germany from Personnel Data

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Author Info

  • Grund, Christian

    ()
    (RWTH Aachen University)

Abstract

The wage policy of a German and a U.S. firm is comparatively analysed with a focus on the relation between wages and hierarchies. While prior studies examine only one particular firm, in this paper two plants of the same owners with similar production processes in different institutional environments are inspected. Convex wage profiles over the hierarchy levels of both plants are found. The U.S. plant shows considerably higher intensity of intra-firm competition in terms of higher intra-level wage inequality and yearly promotion rate. In contrast, wages are more distinctly attached to hierarchy levels in the German firm, as wage regressions show. The results are discussed in comparison to prior studies.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 605.

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Length: 27 pages
Date of creation: Oct 2002
Date of revision:
Handle: RePEc:iza:izadps:dp605

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Keywords: intra-firm wages; personnel records; hierarchies;

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References

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Citations

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Cited by:
  1. Matthias Kräkel, 2008. "Relative Performance Pay, Bonuses, and Job-Promotion Tournaments," Bonn Econ Discussion Papers bgse16_2008, University of Bonn, Germany.
  2. Christian Grund & Niels Westergaard-Nielsen, 2005. "The Dispersion of Employees' Wage Increases and Firm Performance," Bonn Econ Discussion Papers bgse3_2005, University of Bonn, Germany.
  3. Christian Pfeifer, 2009. "Adjustment of Deferred Compensation Schemes, Fairness Concerns, and Hiring of Older Workers," Working Paper Series in Economics 151, University of Lüneburg, Institute of Economics.
  4. Harbring, Christine & Irlenbusch, Bernd, 2005. "How Many Winners Are Good to Have? On Tournaments with Sabotage," IZA Discussion Papers 1777, Institute for the Study of Labor (IZA).
  5. Harbring, Christine & Irlenbusch, Bernd, 2008. "How many winners are good to have?: On tournaments with sabotage," Journal of Economic Behavior & Organization, Elsevier, vol. 65(3-4), pages 682-702, March.
  6. Pfeifer, Christian, 2009. "An Intra-Firm Perspective on Wage Profiles and Employment of Older Workers with Special Reference to Human Capital and Deferred Compensation," Hannover Economic Papers (HEP) dp-413, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
  7. Patrick Kampkoetter, 2012. "Determinants of Compensation in the Financial Services Industry," Cologne Graduate School Working Paper Series 03-12, Cologne Graduate School in Management, Economics and Social Sciences.

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