IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

The establishment-size wage premium: evidence from European countries

  • Thierry Lallemand
  • Robert Plasman
  • François Rycx

This study examines the magnitude and determinants of the establishment-size wage premium in five European countries using a unique harmonised matched employer-employee data set. Findings show the existence of a significant positive wage premium in all countries, even when controlling for labour quality, working conditions, monitoring, sectoral and regional effects, bargaining institutions, job stability, and concentration of skilled workers. In crossnational perspective, results support the existence of an inverse relationship between the size wage gap and the degree of corporatism. Final results indicate that the size wage premium is generally larger in the manufacturing sector and for blue-collar workers.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: https://dipot.ulb.ac.be/dspace/bitstream/2013/8044/1/rp-0144.pdf
File Function: rp-0144
Download Restriction: no

Paper provided by ULB -- Universite Libre de Bruxelles in its series DULBEA Working Papers with number 05-07.RS.

as
in new window

Length: 33 p.
Date of creation: Feb 2005
Date of revision:
Publication status: Published by: DULBEA - Université libre de Bruxelles, Bruxelles
Handle: RePEc:dul:wpaper:05-07rs
Contact details of provider: Web page: http://difusion.ulb.ac.be

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Dunne, Timothy & Schmitz, James A, Jr, 1995. "Wages, Employment Structure and Employer Size-Wage Premia: Their Relationship to Advanced-Technology Usage at US Manufacturing Establishments," Economica, London School of Economics and Political Science, vol. 62(245), pages 89-107, February.
  2. João Carlos Cerejeira da Silva, 2004. "Estimating the employer size-wage premium in a panel data model with comparative advantage and non-random selection," NIPE Working Papers 6/2004, NIPE - Universidade do Minho.
  3. Manning, Alan, 2011. "Imperfect Competition in the Labor Market," Handbook of Labor Economics, Elsevier.
  4. Nickell, Stephen, 1999. "Product markets and labour markets1," Labour Economics, Elsevier, vol. 6(1), pages 1-20, March.
  5. Rene Morissette, 1993. "Canadian Jobs and Firm Size: Do Smaller Firms Pay Less?," Canadian Journal of Economics, Canadian Economics Association, vol. 26(1), pages 159-74, February.
  6. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  7. Charles Brown & James L. Medoff, 1989. "The Employer Size-Wage Effect," NBER Working Papers 2870, National Bureau of Economic Research, Inc.
  8. Dan A. Black & Brett J. Noel & Zheng Wang, 1999. "On-the-Job Training, Establishment Size, and Firm Size: Evidence for Economies of Scale in the Production of Human Capital," Southern Economic Journal, Southern Economic Association, vol. 66(1), pages 82-100, July.
  9. Gannon, Brenda & Plasman, Robert & Rycx, Francois & Tojerow, Ilan, 2005. "Inter-Industry Wage Differentials and the Gender Wage Gap: Evidence from European Countries," IZA Discussion Papers 1563, Institute for the Study of Labor (IZA).
  10. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-44, June.
  11. Madalozzo, Regina, 2002. "The Firm Size Wage Premium: A Quantile Analysis," Insper Working Papers wpe_17, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
  12. Green, Francis & Machin, Stephen & Manning, Alan, 1996. "The Employer Size-Wage Effect: Can Dynamic Monopsony Provide an Explanation?," Oxford Economic Papers, Oxford University Press, vol. 48(3), pages 433-55, July.
  13. Kenneth R. Troske & Kimberly Bayard, 1999. "Examining the Employer-Size Wage Premium in the Manufacturing, Retail Trade, and Service Industries Using Employer-Employee Matched Data," American Economic Review, American Economic Association, vol. 89(2), pages 99-103, May.
  14. Barron, John M & Black, Dan A & Loewenstein, Mark A, 1987. "Employer Size: The Implications for Search, Training, Capital Investment, Starting Wages, and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 5(1), pages 76-89, January.
  15. Edward P. Lazear, 2003. "Firm-Specific Human Capital: A Skill-Weights Approach," NBER Working Papers 9679, National Bureau of Economic Research, Inc.
  16. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
  17. Brunello, Giorgio & Colussi, Aldo, 1998. "The employer size-wage effect: evidence from Italy," Labour Economics, Elsevier, vol. 5(2), pages 217-230, June.
  18. Steven J. DAVIS & John HALTIWANGER, 1996. "Employer Size and the Wage Structure in U.S. Manufacturing," Annales d'Economie et de Statistique, ENSAE, issue 41-42, pages 323-367.
  19. repec:ulb:ulbeco:2013/134390 is not listed on IDEAS
  20. Main, Brian G M & Reilly, Barry, 1993. "The Employer Size-Wage Gap: Evidence for Britain," Economica, London School of Economics and Political Science, vol. 60(238), pages 125-42, May.
  21. Josef Zweimuller & Rudolf Winter-Ebmer, 1999. "Firm-Size Wage Differentials in Switzerland: Evidence from Job-Changers," American Economic Review, American Economic Association, vol. 89(2), pages 89-93, May.
  22. Richard Layard & Stephen Nickell, 1998. "Labour Market Institutions and Economic Performance," CEP Discussion Papers dp0407, Centre for Economic Performance, LSE.
  23. Abowd, J.M. & Kramarz, F. & Margolis, D.N., 1995. "High-Wage Workers and High-Wage Firms," Cahiers de recherche 9503, Universite de Montreal, Departement de sciences economiques.
  24. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
  25. Ana Ferrer & Stephanie Lluis, . "Should Workers Care About Firm Size?," Working Papers 0204, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).
  26. Meagher, Kieron J. & Wilson, Hugh, 2004. "Different firm size effects on wages for supervisors and workers," Economics Letters, Elsevier, vol. 84(2), pages 225-230, August.
  27. Greenwald, Bruce C., 1983. "A general analysis of bias in the estimated standard errors of least squares coefficients," Journal of Econometrics, Elsevier, vol. 22(3), pages 323-338, August.
  28. Hartog, Joop & Leuven, Edwin & Teulings, Coen, 2002. "Wages and the bargaining regime in a corporatist setting: the Netherlands," European Journal of Political Economy, Elsevier, vol. 18(2), pages 317-331, June.
  29. Martijn P. Tummers & Isolde Woittiez, 1991. "A Simultaneous Wage and Labor Supply Model with Hours Restrictions," Journal of Human Resources, University of Wisconsin Press, vol. 26(3), pages 393-423.
  30. Teulings,Coen & Hartog,Joop, 1998. "Corporatism or Competition?," Cambridge Books, Cambridge University Press, number 9780521590730.
  31. Lee, Lung-Fei, 1978. "Unionism and Wage Rates: A Simultaneous Equations Model with Qualitative and Limited Dependent Variables," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 19(2), pages 415-33, June.
  32. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-38, May.
  33. O'Dorchai, Síle & Plasman, Robert & Rycx, Francois, 2007. "The Part-Time Wage Penalty in European Countries: How Large Is It for Men?," IZA Discussion Papers 2591, Institute for the Study of Labor (IZA).
  34. Nicola-Maria Riley, 1997. "Determinants of Union Membership: A Review," LABOUR, CEIS, vol. 11(2), pages 265-301, 06.
  35. Kenneth R Troske, 1994. "Evidence on the Employer Size-Wage Premium From Worker-Establishment Matched Data," Working Papers 94-10, Center for Economic Studies, U.S. Census Bureau.
  36. Idson, Todd L & Feaster, Daniel J, 1990. "A Selectivity Model of Employer-Size Wage Differentials," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 99-122, January.
  37. James J. Heckman, 1976. "The Common Structure of Statistical Models of Truncation, Sample Selection and Limited Dependent Variables and a Simple Estimator for Such Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 475-492 National Bureau of Economic Research, Inc.
  38. Luis Garicano & Esteban Rossi-Hansberg, 2006. "Organization and Inequality in a Knowledge Economy," The Quarterly Journal of Economics, MIT Press, vol. 121(4), pages 1383-1435, November.
  39. Albaek, Karsten & Arai, Mahmood & Asplund, Rita & Barth, Erling & Strojer Madsen, Erik, 1998. "Measuring wage effects of plant size," Labour Economics, Elsevier, vol. 5(4), pages 425-448, December.
  40. Robert Plasman & Michael Rusinek & François Rycx, 2006. "Wages and the bargaining regime under multi-level bargaining: Belgium, Denmark and Spain," DULBEA Working Papers 06-01.RS., ULB -- Universite Libre de Bruxelles.
  41. Christoph Schmidt & Klaus Zimmerman, 1990. "Work Characteristics, Firm Size and Wages," Working Papers 644, Princeton University, Department of Economics, Industrial Relations Section..
  42. Leeth, John D & Ruser, John, 2003. " Compensating Wage Differentials for Fatal and Nonfatal Injury Risk by Gender and Race," Journal of Risk and Uncertainty, Springer, vol. 27(3), pages 257-77, December.
  43. David G. Blanchflower & Andrew J. Oswald & Peter Sanfey, 1992. "Wages, Profits and Rent-Sharing," NBER Working Papers 4222, National Bureau of Economic Research, Inc.
  44. Ekberg, John & Salabasis, Mickael, 2001. "The Firm Size Effect: fact or artifact?," SSE/EFI Working Paper Series in Economics and Finance 462, Stockholm School of Economics.
  45. Mellow, Wesley, 1982. "Employer Size and Wages," The Review of Economics and Statistics, MIT Press, vol. 64(3), pages 495-501, August.
  46. Fakhfakh, Fathi & FitzRoy, Felix, 2005. "Dynamic Monopsony: Evidence from a French Establishment Panel," IZA Discussion Papers 1622, Institute for the Study of Labor (IZA).
  47. Paula B. Voos, 1983. "Union organizing: Costs and benefits," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 36(4), pages 576-591, July.
  48. Alexander Muravyev, 2007. "Firm Size, Wages and Unobserved Skills: Evidence from Dual Job Holdings in the UK," Discussion Papers of DIW Berlin 681, DIW Berlin, German Institute for Economic Research.
  49. François Rycx & Ilan Tojerow & Robert Plasman, 2004. "Rent sharing and the gender wage gap in Belgium," ULB Institutional Repository 2013/785, ULB -- Universite Libre de Bruxelles.
  50. Oi, Walter Y. & Idson, Todd L., 1999. "Firm size and wages," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 33, pages 2165-2214 Elsevier.
  51. Knut Gerlach & OLAF HÜBLER, 1998. "Firm Size and Wages in Germany – Trends and Impacts of Mobility," Empirica, Springer, vol. 25(3), pages 245-261, January.
  52. Brenda Gannon & Brian Nolan, 2004. "Inter-Industry Wage Differentials in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 35(2), pages 157–182.
  53. Paul Fenn & Simon Ashby, 2004. "Workplace Risk, Establishment Size and Union Density," British Journal of Industrial Relations, London School of Economics, vol. 42(3), pages 461-480, 09.
  54. Kahn, Lawrence M, 1998. "Collective Bargaining and the Interindustry Wage Structure: International Evidence," Economica, London School of Economics and Political Science, vol. 65(260), pages 507-34, November.
  55. Barzel, Yoram, 1973. "The Determination of Daily Hours and Wages," The Quarterly Journal of Economics, MIT Press, vol. 87(2), pages 220-38, May.
  56. Winter-Ebmer, Rudolf, 2001. "Firm Size, Earnings, and Displacement Risk," Economic Inquiry, Western Economic Association International, vol. 39(3), pages 474-86, July.
  57. Eaton, Curtis & White, William D, 1983. "The Economy of High Wages: An Agency Problem," Economica, London School of Economics and Political Science, vol. 50(198), pages 175-81, May.
  58. Walter Y. Oi & Todd L. Idson, 1999. "Workers Are More Productive in Large Firms," American Economic Review, American Economic Association, vol. 89(2), pages 104-108, May.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:dul:wpaper:05-07rs. 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: (Benoit Pauwels)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.