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Within-establishment wage inequality and satisfaction

  • Ambra Poggi

We empirically model individual utility from pay as function of worker’s own wage and the earnings of all other workers within the same establishment. The aims of this paper are twofold: first, to study the mechanisms underlying the importance of relative wages in determining worker satisfaction; second, to assess whether high within establishment wage inequality leads, on average, to high satisfaction. .

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File URL: http://www.laboratoriorevelli.it/_pdf/wp100.pdf
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Paper provided by LABORatorio R. Revelli, Centre for Employment Studies in its series LABORatorio R. Revelli Working Papers Series with number 100.

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Date of creation: 2010
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Handle: RePEc:cca:wplabo:100
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  1. Clark, Andrew E. & Frijters, Paul & Shields, Michael A., 2007. "Relative Income, Happiness and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," IZA Discussion Papers 2840, Institute for the Study of Labor (IZA).
  2. Ada Ferrer-i-Carbonell & Paul Frijters, 2002. "How important is Methodology for the Estimates of the Determinants of Happiness?," Tinbergen Institute Discussion Papers 02-024/3, Tinbergen Institute.
  3. David Card & Alexandre Mas & Enrico Moretti & Emmanuel Saez, 2010. "Inequality at Work: The Effect of Peer Salaries on Job Satisfaction," NBER Working Papers 16396, National Bureau of Economic Research, Inc.
  4. Vendrik Maarten & Woltjer Geert, 2006. "Happiness and Loss Aversion: When Social Participation Dominates Comparision," Research Memorandum 027, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  5. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory Of Fairness, Competition, And Cooperation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 817-868, August.
  6. Janiszewski, Chris & Lichtenstein, Donald R, 1999. " A Range Theory Account of Price Perception," Journal of Consumer Research, University of Chicago Press, vol. 25(4), pages 353-68, March.
  7. Kahneman, Daniel & Tversky, Amos, 1979. "Prospect Theory: An Analysis of Decision under Risk," Econometrica, Econometric Society, vol. 47(2), pages 263-91, March.
  8. Wunder, Christoph & Schwarze, Johannes, 2006. "Income Inequality and Job Satisfaction of Full-Time Employees in Germany," IZA Discussion Papers 2084, Institute for the Study of Labor (IZA).
  9. P. J. Sloane & H. Williams, 2000. "Job Satisfaction, Comparison Earnings, and Gender," LABOUR, CEIS, vol. 14(3), pages 473-502, 09.
  10. Stutzer, Alois, 2004. "The role of income aspirations in individual happiness," Journal of Economic Behavior & Organization, Elsevier, vol. 54(1), pages 89-109, May.
  11. Robson, Arthur J, 1992. "Status, the Distribution of Wealth, Private and Social Attitudes to Risk," Econometrica, Econometric Society, vol. 60(4), pages 837-57, July.
  12. Blanchflower, David G. & Oswald, Andrew J., 2001. "Well-Being Over Time in Britain and the USA," The Warwick Economics Research Paper Series (TWERPS) 616, University of Warwick, Department of Economics.
  13. Andrew E. Clark & Nicolai Kristensen & Niels Westergård-Nielsen, 2009. "Economic Satisfaction and Income Rank in Small Neighbourhoods," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 519-527, 04-05.
  14. Malcolm Patterson & Peter Warr & Michael West, 2004. "Organizational climate and company productivity: the role of employee affect and employee level," LSE Research Online Documents on Economics 19977, London School of Economics and Political Science, LSE Library.
  15. Christian Seidl & Stefan Traub & Andrea Morone, 2004. "Relative Deprivation, Personal Income Satisfaction, and Average Well-Being under Different Income Distributions," Experimental 0401004, EconWPA.
  16. Rojas, Mariano, 2007. "Heterogeneity in the relationship between income and happiness: A conceptual-referent-theory explanation," Journal of Economic Psychology, Elsevier, vol. 28(1), pages 1-14, January.
  17. Layard, Richard, 1980. "Human Satisfactions and Public Policy," Economic Journal, Royal Economic Society, vol. 90(363), pages 737-50, December.
  18. Akerlof, George A & Yellen, Janet L, 1990. "The Fair Wage-Effort Hypothesis and Unemployment," The Quarterly Journal of Economics, MIT Press, vol. 105(2), pages 255-83, May.
  19. van de Stadt, Huib & Kapteyn, Arie & van de Geer, Sara, 1985. "The Relativity of Utility: Evidence from Panel Data," The Review of Economics and Statistics, MIT Press, vol. 67(2), pages 179-87, May.
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