IDEAS home Printed from https://ideas.repec.org/a/wly/emetrp/v89y2021i2p647-676.html
   My bibliography  Save this article

Learning From Coworkers

Author

Listed:
  • Gregor Jarosch
  • Ezra Oberfield
  • Esteban Rossi‐Hansberg

Abstract

We investigate learning at the workplace. To do so, we use German administrative data that contain information on the entire workforce of a sample of establishments. We document that having more‐highly‐paid coworkers is strongly associated with future wage growth, particularly if those workers earn more. Motivated by this fact, we propose a dynamic theory of a competitive labor market where firms produce using teams of heterogeneous workers that learn from each other. We develop a methodology to structurally estimate knowledge flows using the full‐richness of the German employer‐employee matched data. The methodology builds on the observation that a competitive labor market prices coworker learning. Our quantitative approach imposes minimal restrictions on firms' production functions, can be implemented on a very short panel, and allows for potentially rich and flexible coworker learning functions. In line with our reduced‐form results, learning from coworkers is significant, particularly from more knowledgeable coworkers. We show that between 4 and 9% of total worker compensation is in the form of learning and that inequality in total compensation is significantly lower than inequality in wages.

Suggested Citation

  • Gregor Jarosch & Ezra Oberfield & Esteban Rossi‐Hansberg, 2021. "Learning From Coworkers," Econometrica, Econometric Society, vol. 89(2), pages 647-676, March.
  • Handle: RePEc:wly:emetrp:v:89:y:2021:i:2:p:647-676
    DOI: 10.3982/ECTA16915
    as

    Download full text from publisher

    File URL: https://doi.org/10.3982/ECTA16915
    Download Restriction: no

    File URL: https://libkey.io/10.3982/ECTA16915?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. , & Lorenz, Jan & ,, 2016. "Innovation vs. imitation and the evolution of productivity distributions," Theoretical Economics, Econometric Society, vol. 11(3), September.
    2. Robert E. Lucas Jr. & Benjamin Moll, 2014. "Knowledge Growth and the Allocation of Time," Journal of Political Economy, University of Chicago Press, vol. 122(1), pages 1-51.
    3. Ken Burdett & Melvyn Coles, 2003. "Equilibrium Wage-Tenure Contracts," Econometrica, Econometric Society, vol. 71(5), pages 1377-1404, September.
    4. Erzo G. J. Luttmer, 2014. "An Assignment Model of Knowledge Diffusion and Income Inequality," Working Papers 715, Federal Reserve Bank of Minneapolis.
    5. Eberle, Johanna & Schmucker, Alexandra & Seth, Stefan, 2013. "Example programs for data preparation of the sample of integrated labour market biographies for Stata : creating cross-sectional data and biographical variables," FDZ Methodenreport 201304_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    6. Alexandre Mas & Enrico Moretti, 2009. "Peers at Work," American Economic Review, American Economic Association, vol. 99(1), pages 112-145, March.
    7. Francisco J. Buera & Ezra Oberfield, 2020. "The Global Diffusion of Ideas," Econometrica, Econometric Society, vol. 88(1), pages 83-114, January.
    8. Fabien Postel-Vinay & Jean-Marc Robin, 2002. "Equilibrium Wage Dispersion with Worker and Employer Heterogeneity," Econometrica, Econometric Society, vol. 70(6), pages 2295-2350, November.
    9. Jäger, Simon & Heining, Jörg, 2019. "How Substitutable Are Workers? Evidence from Worker Deaths," MPRA Paper 109757, University Library of Munich, Germany, revised 01 Jan 2019.
    10. Santiago Caicedo & Robert E. Lucas Jr. & Esteban Rossi-Hansberg, 2019. "Learning, Career Paths, and the Distribution of Wages," American Economic Journal: Macroeconomics, American Economic Association, vol. 11(1), pages 49-88, January.
    11. Fernando E. Alvarez & Francisco J. Buera & Robert E. Lucas, Jr., 2013. "Idea Flows, Economic Growth, and Trade," NBER Working Papers 19667, National Bureau of Economic Research, Inc.
    12. Ernest Miguelez & Ufuk Akcigit & Stefanie Stantcheva & Valerio Sterzi & Santiago Caicedo, 2018. "Dancing with the Stars: Innovation Through Interactions," Post-Print hal-02274133, HAL.
    13. repec:iab:iabfme:201304(en is not listed on IDEAS
    14. Kyle Herkenhoff & Gordon Phillips & Jeremy Lise & guido menzio, 2018. "Worker Mobility and the Diffusion of Knowledge," 2018 Meeting Papers 457, Society for Economic Dynamics.
    15. repec:hal:spmain:info:hdl:2441/c8dmi8nm4pdjkuc9g8grh35j2 is not listed on IDEAS
    16. Jovanovic, Boyan & MacDonald, Glenn M, 1994. "Competitive Diffusion," Journal of Political Economy, University of Chicago Press, vol. 102(1), pages 24-52, February.
    17. Boyan Jovanovic & Rafael Rob, 1989. "The Growth and Diffusion of Knowledge," Review of Economic Studies, Oxford University Press, vol. 56(4), pages 569-582.
    18. Fabien Postel-Vinay & Jean-Marc Robin, 2002. "Equilibrium Wage Dispersion with Worker and Employer Heterogeneity," Post-Print hal-03458567, HAL.
    19. Jesse Perla & Christopher Tonetti, 2014. "Equilibrium Imitation and Growth," Journal of Political Economy, University of Chicago Press, vol. 122(1), pages 52-76.
    20. Boyan Jovanovic, 2014. "Misallocation and Growth," American Economic Review, American Economic Association, vol. 104(4), pages 1149-1171, April.
    21. Axel Anderson & Lones Smith, 2010. "Dynamic Matching and Evolving Reputations," Review of Economic Studies, Oxford University Press, vol. 77(1), pages 3-29.
    22. Steven J. Davis & Till Von Wachter, 2011. "Recessions and the Costs of Job Loss," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 42(2 (Fall)), pages 1-72.
    23. Fabien Postel-Vinay & Jean-Marc Robin, 2002. "Equilibrium wage dispersion with worker and employer heterogeneity," Post-Print hal-03587660, HAL.
    24. Klosterhuber, Wolfram & Heining, Jörg & Seth, Stefan, 2014. "Linked-employer-employee-data from the IAB: LIAB longitudinal model 1993-2010 (LIAB LM 9310)," FDZ Datenreport. Documentation on Labour Market Data 201308_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    25. repec:hal:spmain:info:hdl:2441/dc0ckec3fcb29ms985085gkbp is not listed on IDEAS
    26. Luis Garicano & Esteban Rossi-Hansberg, 2006. "Organization and Inequality in a Knowledge Economy," The Quarterly Journal of Economics, Oxford University Press, vol. 121(4), pages 1383-1435.
    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. Luca David Opromolla & Giordano Mion & Gianmarco I.P. Ottaviano, 2020. "Dream Jobs," GEE Papers 0153, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Jul 2020.
    2. Evangelos Dioikitopoulos & Dimitrios Varvarigos, 2023. "Delay in childbearing and the evolution of fertility rates," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(3), pages 1545-1571, July.
    3. Benjamin Lochner & Bastian Schulz, 2024. "Firm Productivity, Wages, and Sorting," Journal of Labor Economics, University of Chicago Press, vol. 42(1), pages 85-119.
    4. Arellano-Bover, Jaime & Saltiel, Fernando, 2021. "Differences in On-the-Job Learning across Firms," IZA Discussion Papers 14473, Institute of Labor Economics (IZA).
    5. Garcia-Louzao, Jose & Hospido, Laura & Ruggieri, Alessandro, 2023. "Dual returns to experience," Labour Economics, Elsevier, vol. 80(C).
    6. Liu, Sitian & Su, Yichen, 2022. "The Effect of Working from Home on the Agglomeration Economies of Cities: Evidence from Advertised Wages," MPRA Paper 114429, University Library of Munich, Germany.
    7. Schivardi, Fabiano & Sauvagnat, Julien, 2020. "Are Executives in Short Supply? Evidence from Deaths' Events," CEPR Discussion Papers 14334, C.E.P.R. Discussion Papers.
    8. Davide Dottori & Francesca Modena & Giulia Martina Tanzi, 2023. "Measuring peer effects in parental leaves: evidence from a reform," Temi di discussione (Economic working papers) 1399, Bank of Italy, Economic Research and International Relations Area.
    9. Huneeus, Federico & Larrain, Borja & Larrain, Mauricio & Prem, Mounu, 2021. "The internal labor markets of business groups," Journal of Corporate Finance, Elsevier, vol. 69(C).
    10. Chesney, Alexander J., 2022. "Should I get a master’s degree?," Economics of Education Review, Elsevier, vol. 91(C).
    11. Moscelli, Giuseppe & Sayli, Melisa & Mello, Marco, 2022. "Staff Engagement, Coworkers' Complementarity and Employee Retention: Evidence from English NHS Hospitals," IZA Discussion Papers 15638, Institute of Labor Economics (IZA).
    12. Nix, Emily, 2020. "A researcher’s guide to the Swedish compulsory school reform," Working Paper Series 2020:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    13. Sohail, Faisal, 2021. "From employee to entrepreneur: Learning, employer size, and spinout dynamics," Journal of Economic Dynamics and Control, Elsevier, vol. 133(C).
    14. Arellano-Bover, Jaime, 2020. "Career Consequences of Firm Heterogeneity for Young Workers: First Job and Firm Size," IZA Discussion Papers 12969, Institute of Labor Economics (IZA).
    15. Granaglia, Elena, 2019. "Can market inequalities be justified? The intrinsic shortcomings of meritocracy," Structural Change and Economic Dynamics, Elsevier, vol. 51(C), pages 284-290.
    16. Victoria Gregory, 2020. "Firms as Learning Environments: Implications for Earnings Dynamics and Job Search," Working Papers 2020-036, Federal Reserve Bank of St. Louis, revised Sep 2023.
    17. Luca David Opromolla & Giordano Mion & Gianmarco I.P. Ottaviano, 2020. "Dream Jobs," GEE Papers 0153, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Jul 2020.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Francisco J. Buera & Ezra Oberfield, 2020. "The Global Diffusion of Ideas," Econometrica, Econometric Society, vol. 88(1), pages 83-114, January.
    2. Jess Benhabib & Jesse Perla & Christopher Tonetti, 2021. "Reconciling Models of Diffusion and Innovation: A Theory of the Productivity Distribution and Technology Frontier," Econometrica, Econometric Society, vol. 89(5), pages 2261-2301, September.
    3. Erzo G. J. Luttmer, 2014. "An Assignment Model of Knowledge Diffusion and Income Inequality," Working Papers 715, Federal Reserve Bank of Minneapolis.
    4. Gottfries, Axel & Teulings, Coen, 2017. "Returns to On-the-Job Search and the Dispersion of Wages," IZA Discussion Papers 10668, Institute of Labor Economics (IZA).
    5. Gottfries, Axel & Teulings, Coen, 2016. "Returns to on-the-job search and the dispersion of wages," LSE Research Online Documents on Economics 86219, London School of Economics and Political Science, LSE Library.
    6. Axel Gottfries & Coen N. Teulings, 2017. "Returns to On-The-Job Search and the Dispersion of Wages," CESifo Working Paper Series 6410, CESifo.
    7. Axel Gottfries & Coen N. Teulings, 2016. "Returns to on-the-job search and the dispersion of wages," Discussion Papers 1629, Centre for Macroeconomics (CFM).
    8. Teulings, Coen & Gottfries, Axel, 2017. "Returns to on-the-job search and the dispersion of wages," CEPR Discussion Papers 11921, C.E.P.R. Discussion Papers.
    9. Gottfries, A. & Teulings, T., 2017. "Returns to On-the-Job Search and the Dispersion of Wages," Cambridge Working Papers in Economics 1737, Faculty of Economics, University of Cambridge.
    10. Philip Jung & Moritz Kuhn, 2019. "Earnings Losses and Labor Mobility Over the Life Cycle," Journal of the European Economic Association, European Economic Association, vol. 17(3), pages 678-724.
    11. David de la Croix & Matthias Doepke & Joel Mokyr, 2018. "Clans, Guilds, and Markets: Apprenticeship Institutions and Growth in the Preindustrial Economy," The Quarterly Journal of Economics, Oxford University Press, vol. 133(1), pages 1-70.
    12. Kevin Fawcett & Shouyong Shi, 2018. "Learning, On-the-Job Search and Wage-Tenure Contracts," Working Papers tecipa-597, University of Toronto, Department of Economics.
    13. Eran B. Hoffmann & Mr. Davide Malacrino, 2018. "Employment Time and the Cyclicality of Earnings Growth," IMF Working Papers 2018/115, International Monetary Fund.
    14. Hoffmann, Eran B. & Malacrino, Davide, 2019. "Employment time and the cyclicality of earnings growth," Journal of Public Economics, Elsevier, vol. 169(C), pages 160-171.
    15. Nelson Lind & Natalia Ramondo, 2023. "Global Innovation and Knowledge Diffusion," American Economic Review: Insights, American Economic Association, vol. 5(4), pages 494-510, December.
    16. Bayer, Christian & Kuhn, Moritz, 2018. "Which Ladder to Climb? Decomposing Life Cycle Wage Dynamics," CEPR Discussion Papers 13158, C.E.P.R. Discussion Papers.
    17. Kjetil Storesletten & Bo Zhao & Fabrizio Zilibotti, 2019. "Business Cycle during Structural Change: Arthur Lewis' Theory from a Neoclassical Perspective," Cowles Foundation Discussion Papers 2191, Cowles Foundation for Research in Economics, Yale University.
    18. Cozzi, Marco & Fella, Giulio, 2016. "Job displacement risk and severance pay," Journal of Monetary Economics, Elsevier, vol. 84(C), pages 166-181.
    19. Eliason, Marcus & Hensvik, Lena & Kramarz, Francis & Skans, Oskar Nordström, 2023. "Social connections and the sorting of workers to firms," Journal of Econometrics, Elsevier, vol. 233(2), pages 468-506.
    20. Nelson Lind & Natalia Ramondo, 2018. "Innovation, Knowledge Diffusion, and Globalization," NBER Working Papers 25071, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    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:wly:emetrp:v:89:y:2021:i:2:p:647-676. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/essssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.