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The Employer Size-Wage Effect: Is Monopsony the Explanation?

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  • Francis Green
  • Stephen Machin
  • Alan Manning

Abstract

This paper looks at evidence on the employer size-wage effect for the UK using data from the General Household Survey, British Social Attitudes Survey and the Workplace Industrial Relations Survey. We find that much larger effects in the non-union sector and for women. We consider various theoretical explanations for the size-wage effect and conclude that our findings are most consistent with a dynamic monopsony model.

Suggested Citation

  • Francis Green & Stephen Machin & Alan Manning, 1992. "The Employer Size-Wage Effect: Is Monopsony the Explanation?," CEP Discussion Papers dp0079, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp0079
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    Cited by:

    1. Robin Naylor, 1994. "Pay discrimination and imperfect competition in the labor market," Journal of Economics, Springer, vol. 60(2), pages 177-188, June.
    2. Rebecca M. Blank, 1993. "Public Sector Growth and Labor Market Flexibility: The United States vs. The United Kingdom," NBER Working Papers 4339, National Bureau of Economic Research, Inc.
    3. Rebecca M. Blank, 1994. "Public Sector Growth and Labor Market Flexibility: The United States versus the United Kingdom," NBER Chapters,in: Social Protection versus Economic Flexibility: Is There a Trade-Off?, pages 223-264 National Bureau of Economic Research, Inc.
    4. A. Nikolaou & I. Theodossiou, 2003. "Living in unemployment or who experiences a high unemployment burden?," Applied Economics, Taylor & Francis Journals, vol. 35(11), pages 1271-1276.
    5. Knut Gerlach & OLAF HÜBLER, 1998. "Firm Size and Wages in Germany – Trends and Impacts of Mobility," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 25(3), pages 245-261, January.
    6. Andrew Jenkins & Anna Vignoles & Alison Wolf & Fernando Galindo-Rueda, 2003. "The determinants and labour market effects of lifelong learning," Applied Economics, Taylor & Francis Journals, vol. 35(16), pages 1711-1721.

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