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

Employer Size and The Wage Structure in U.S. Manufacturing

Contents:

Author Info

  • Steven J. Davis
  • John Haltiwanger

Abstract

We study how the hourly wage structure varies with establishment size and how wage dispersion breaks down into between-plant and within-plant components Our study combines household and establishment data for the U.S. manufacturing sector in 1982. 1) Wage dispersion falls sharply with establishment size for nonproduction workers and mildly for production workers. 2) Size-class differences in wage dispersion often mask even sharper differences in the dispersion of wages generated by observable worker characteristics and in the 'skill prices' on those characteristics. 3) In terms of dispersion in predicted log wages worker heterogeneity tends to rise with establishment size production workers are much more homogenous in the union sector, but only at plants with 1,000 or more workers. 4) Unobserved factors generate sharply greater wage dispersion at smaller establishments. 5) The variance in mean wages across establishments accounts for 59% of total variance. Within-plant wage variance among production workers accounts for a mere 2%. 6) Mean wage differences by size of establishment account for about one-fourth of the total between-plant variance of wages. 7) Between-plant wage dispersion falls sharply with establishment size, entirely accounting for the negative relationship of establishment size to overall wage dispersion. Guided by these and other empirical findings, we assess several hypotheses about the determination of the wage structure.

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://www.nber.org/papers/w5393.pdf
Download Restriction: no

Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5393.

as in new window
Length:
Date of creation: Dec 1995
Date of revision:
Publication status: published as Annales D'Economie Et De Statistique, No.41/42, 1996, pp.323-367.
Handle: RePEc:nbr:nberwo:5393

Note: LS
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Phone: 617-868-3900
Email:
Web page: http://www.nber.org
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

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. Richard B. Freeman, 1980. "Unionism and the dispersion of wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 34(1), pages 3-23, October.
  2. Rosen, Sherwin, 1987. "The theory of equalizing differences," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 12, pages 641-692 Elsevier.
  3. Katz, Lawrence F & Murphy, Kevin M, 1992. "Changes in Relative Wages, 1963-1987: Supply and Demand Factors," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(1), pages 35-78, February.
  4. Lambson, V.E., 1989. "Industry Evolution With Sunk Costs And Uncertian Market Conditions," Working papers, Wisconsin Madison - Social Systems 8904, Wisconsin Madison - Social Systems.
  5. Steve J. Davis & John Haltiwanger, 1991. "Gross Job Creation, Gross Job Destruction and Employment Reallocation," NBER Working Papers 3728, National Bureau of Economic Research, Inc.
  6. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 89(5), pages 841-64, October.
  7. Kahn, Lawrence M & Curme, Michael, 1987. "Unions and Nonunion Wage Dispersion," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 600-607, November.
  8. Mellow, Wesley, 1982. "Employer Size and Wages," The Review of Economics and Statistics, MIT Press, vol. 64(3), pages 495-501, August.
  9. Garen, John E, 1985. "Worker Heterogeneity, Job Screening, and Firm Size," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 93(4), pages 715-39, August.
  10. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, Econometric Society, vol. 50(3), pages 649-70, May.
  11. Richard Ericson & Ariel Pakes, 1992. "An Alternative Theory of Firm and Industry Dynamics," Cowles Foundation Discussion Papers, Cowles Foundation for Research in Economics, Yale University 1041, Cowles Foundation for Research in Economics, Yale University.
  12. Brown, Charles & Medoff, James, 1989. "The Employer Size-Wage Effect," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 97(5), pages 1027-59, October.
  13. Farber, Henry S & Saks, Daniel H, 1980. "Why Workers Want Unions: The Role of Relative Wages and Job Characteristics," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 88(2), pages 349-69, April.
  14. Lazear, Edward P, 1989. "Pay Equality and Industrial Politics," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 97(3), pages 561-80, June.
  15. Dunne, Timothy & Roberts, Mark J & Samuelson, Larry, 1989. "The Growth and Failure of U.S. Manufacturing Plants," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 104(4), pages 671-98, November.
  16. Paula B. Voos, 1983. "Union organizing: Costs and benefits," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 36(4), pages 576-591, July.
  17. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 101(3), pages 410-42, June.
  18. Steve J. Davis & John Haltiwanger, 1991. "Wage Dispersion Between and Within U.S. Manufacturing Plants, 1963-1986," NBER Working Papers 3722, National Bureau of Economic Research, Inc.
  19. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, The MIT Press, edition 1, volume 1, number 0262540932, December.
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:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

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:nbr:nberwo:5393. 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: ().

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.