Estimating the employer size-wage premium in a panel data model with comparative advantage and non-random selection
AbstractThis paper considers the estimation of the employer-size wage e?ect using a panel of employer-employee matched data. We test for the possibility of different returns to observable human capital variables as well as examine the role played by unmeasured skills in driving the allocation of workers across firms of di?erent sizes. Our results show that some of the observed skills; namely, education, age, and tenure have high returns in large firms, while the opposite is true for high skilled occupations and for the gender gap. On the other hand, the price of non-observed skills is reduced as firm size increases. This finding is consistent with explanations based on the premise that large employers have more difficulty monitoring workers, which therefore leads them to monitor less closely.
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Bibliographic InfoPaper provided by NIPE - Universidade do Minho in its series NIPE Working Papers with number 6/2004.
Date of creation: 2004
Date of revision:
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Find related papers by JEL classification:
- D20 - Microeconomics - - Production and Organizations - - - General
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-07-04 (All new papers)
- NEP-LAB-2004-07-04 (Labour Economics)
- NEP-MIC-2004-07-04 (Microeconomics)
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