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The Employment Consequences of Seniority Wages

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  • Zwick, Thomas

Abstract

This paper combines two strains of the literature on the employment effects of deferred compensation. The first strain separates seniority and job matching wage effects on the basis of individual data, but cannot look at employment consequences. The second strain explains the employment structure on the basis of establishment data, but cannot properly calculate seniority wages. This paper uses linked employeremployee data, aggregates individual seniority wages to the establishment level, and correlates them with the establishment employment structure. According to the deferred compensation hypothesis this paper finds that establishments with stronger seniority wages have a higher tenure but hire less older employees. --

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Bibliographic Info

Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 08-039.

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Date of creation: 2008
Date of revision:
Handle: RePEc:zbw:zewdip:7311

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Keywords: Seniority Wages; Employment Structure; Linked Employer-Employee Data;

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References

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  1. Lorne Carmichael, 1981. "Firm-Specific Human Capital and Promotion Ladders," Working Papers 452, Queen's University, Department of Economics.
  2. Edward P. Lazear, 1999. "Personnel Economics: Past Lessons and Future Directions," NBER Working Papers 6957, National Bureau of Economic Research, Inc.
  3. Hutchens, Robert M, 1987. "A Test of Lazear's Theory of Delayed Payment Contracts," Journal of Labor Economics, University of Chicago Press, vol. 5(4), pages S153-70, October.
  4. Katharine G. Abraham & Henry S. Farber, 1987. "Job Duration, Seniority, and Earnings," NBER Working Papers 1819, National Bureau of Economic Research, Inc.
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Citations

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Cited by:
  1. Thomas Zwick, 2012. "Earnings Losses after Non-Employment Increase with Age," Schmalenbach Business Review (sbr), LMU Munich School of Management, vol. 64(1), pages 2-19, January.
  2. Göbel, Christian & Zwick, Thomas, 2010. "Which personnel measures are effective in increasing productivity of old workers?," ZEW Discussion Papers 10-069, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. Bonin, Holger, 2009. "15 years of pension reform in Germany: old successes and new threats," ZEW Discussion Papers 09-035, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  4. 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.
  5. Zwick, Thomas, 2009. "Why Pay Seniority Wages?," ZEW Discussion Papers 09-005, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  6. Göbel, Christian & Zwick, Thomas, 2011. "Age and productivity: Sector differences?," ZEW Discussion Papers 11-058, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  7. Zwick, Thomas, 2011. "Seniority wages and establishment characteristics," Labour Economics, Elsevier, vol. 18(6), pages 853-861.
  8. Anja Deelen, 2011. "Wage-Tenure Profiles and Mobility," CPB Discussion Paper 198, CPB Netherlands Bureau for Economic Policy Analysis.
  9. Anja Deelen, 2012. "Wage-Tenure Profiles and Mobility," De Economist, Springer, vol. 160(2), pages 141-155, June.

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