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Monopsony and rent sharing: Evidence from Italian hiring subsidies

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  • Pacelli, Lia
  • Passerini, Filippo

Abstract

We estimate that hiring subsidies reduce concentration in labor markets where both small and large firms coexist. Wages increase only when HSs are in place and firms keep 96% of the subsidy amount, indicating that even small firms have relevant wage-setting power.

Suggested Citation

  • Pacelli, Lia & Passerini, Filippo, 2024. "Monopsony and rent sharing: Evidence from Italian hiring subsidies," Economics Letters, Elsevier, vol. 244(C).
    • Handle: RePEc:eee:ecolet:v:244:y:2024:i:c:s0165176524004865
    DOI: 10.1016/j.econlet.2024.112002
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    References listed on IDEAS

    as
    1. Marco Leonardi & Giovanni Pica, 2013. "Who Pays for it? The Heterogeneous Wage Effects of Employment Protection Legislation," Economic Journal, Royal Economic Society, vol. 123(12), pages 1236-1278, December.
    2. Marinescu, Ioana & Ouss, Ivan & Pape, Louis-Daniel, 2021. "Wages, hires, and labor market concentration," Journal of Economic Behavior & Organization, Elsevier, vol. 184(C), pages 506-605.
    3. David C. Chan, 2018. "The Efficiency of Slacking off: Evidence From the Emergency Department," Econometrica, Econometric Society, vol. 86(3), pages 997-1030, May.
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    More about this item

    Keywords

    Monopsony; Labor market concentration; Hiring subsidies; Wages;
    All these keywords.

    JEL classification:

    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • J48 - Labor and Demographic Economics - - Particular Labor Markets - - - Particular Labor Markets; Public Policy

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