IDEAS home Printed from https://ideas.repec.org/a/sae/ilrrev/v44y1991i3p520-535.html
   My bibliography  Save this article

Encouraging Long-Term Tenure: Wage Tilt or Pensions?

Author

Listed:
  • Richard A. Ippolito

Abstract

The author analyzes data on 6,416 persons in 109 firms to determine whether the length of these workers' tenure was positively related either to wage tilt—the payment of below-market wages in the early years of the worker's employment with a firm and above-market wages in the later years—or to the presence of defined benefit pension plans. Contrary to the popular (but little-tested) hypothesis that wage tilt is important in inducing workers to make long-term commitments to the firm, the results show that wage tilt had no significant effect on tenure, except indirectly through its effect on pension quit costs. In contrast, pensions increased tenure in the firm, on average, by more than 20%.

Suggested Citation

  • Richard A. Ippolito, 1991. "Encouraging Long-Term Tenure: Wage Tilt or Pensions?," ILR Review, Cornell University, ILR School, vol. 44(3), pages 520-535, April.
  • Handle: RePEc:sae:ilrrev:v:44:y:1991:i:3:p:520-535
    as

    Download full text from publisher

    File URL: http://ilr.sagepub.com/content/44/3/520.abstract
    Download Restriction: no

    References listed on IDEAS

    as
    1. David Card, 1989. "The Impact of the Mariel Boatlift on the Miami Labor Market," Working Papers 633, Princeton University, Department of Economics, Industrial Relations Section..
    2. Borjas, George J, 1986. "The Sensitivity of Labor Demand Functions to Choice of Dependent Variable," The Review of Economics and Statistics, MIT Press, pages 58-66.
    3. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-489, October.
    4. David Card, 1990. "The Impact of the Mariel Boatlift on the Miami Labor Market," ILR Review, Cornell University, ILR School, vol. 43(2), pages 245-257, January.
    5. Robert J. LaLonde & Robert H. Topel, 1991. "Labor Market Adjustments to Increased Immigration," NBER Chapters,in: Immigration, Trade, and the Labor Market, pages 167-199 National Bureau of Economic Research, Inc.
    6. Greenwood, Michael J & McDowell, John M, 1986. "The Factor Market Consequences of U.S. Immigration," Journal of Economic Literature, American Economic Association, pages 1738-1772.
    7. Borjas, George J, 1987. "Self-Selection and the Earnings of Immigrants," American Economic Review, American Economic Association, pages 531-553.
    8. Borjas, George J, 1986. "The Sensitivity of Labor Demand Functions to Choice of Dependent Variable," The Review of Economics and Statistics, MIT Press, pages 58-66.
    9. Grossman, Jean Baldwin, 1982. "The Substitutability of Natives and Immigrants in Production," The Review of Economics and Statistics, MIT Press, pages 596-603.
    10. Joseph G. Altonji & David Card, 1989. "The Effects of Immigration on the Labor Market Outcomes of Natives," NBER Working Papers 3123, National Bureau of Economic Research, Inc.
    11. Francine D. Blau, 1984. "The Use of Transfer Payments by Immigrants," ILR Review, Cornell University, ILR School, vol. 37(2), pages 222-239, January.
    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


    Cited by:

    1. Montgomery, Edward & Shaw, Kathryn, 1997. "Pensions and Wage Premia," Economic Inquiry, Western Economic Association International, vol. 35(3), pages 510-522, July.
    2. Michael, Steven C., 1996. "To franchise or not to franchise: An analysis of decision rights and organizational form shares," Journal of Business Venturing, Elsevier, vol. 11(1), pages 57-71, January.
    3. Harley Frazis & Mark A. Loewenstein, 2009. "How Responsive are Quits to Benefits?," Working Papers 426, U.S. Bureau of Labor Statistics.
    4. palacios, Robert & Whitehouse, Edward, 2006. "Civil-service pension schemes around the world," Social Protection and Labor Policy and Technical Notes 90340, The World Bank.
    5. Robert L. Clark & Joseph F. Quinn, 1999. "Effects of Pensions on Labor Markets and Retirement," Boston College Working Papers in Economics 431, Boston College Department of Economics.
    6. Leora Friedberg & Michael T. Owyang, 2004. "Explaining the evolution of pension structure and job tenure," Working Papers 2002-022, Federal Reserve Bank of St. Louis.
    7. Ashok Thomas & Luca Spataro, 2016. "The Effects Of Pension Funds On Markets Performance: A Review," Journal of Economic Surveys, Wiley Blackwell, vol. 30(1), pages 1-33, February.
    8. repec:bin:bpeajo:v:26:y:1994:i:1994-3:p:177-248 is not listed on IDEAS
    9. Sundaram, Rangarajan K. & Yermack, David, 2006. "Pay Me Later: Inside Debt and Its Role in Managerial Compensation," SIFR Research Report Series 43, Institute for Financial Research.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ilrrev:v:44:y:1991:i:3:p:520-535. 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: (SAGE Publications). General contact details of provider: http://www.ilr.cornell.edu .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.