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The Extent of Rent Sharing along the Wage Distribution

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  • Alessia Matano

    () (Universitat de Barcelona, AQR-IREA and University of Rome “La Sapienza”, Dipartimento di Analisi Economiche e Sociali.)

  • Paolo Naticchioni

    () (Roma Tre University and IZA, Via Chiabrera 199 – 00145 Rome (IT).)

Abstract

The relation between rent sharing and wages has generally been evaluated on average wages. This paper uses a unique employer-employee panel database to investigate the extent of rent sharing along the wage distribution in Italy. We apply quantile regression techniques and control for national level bargaining, unobserved worker and firm heterogeneity and endogeneity. Our findings show that the extent of rent-sharing decreases along the wage distribution, suggesting that unskilled workers benefit most from firms’ rents. By applying quantile regressions by occupational categories, we show that the decreasing pattern is mainly driven by blue collar workers, while estimates for white collars are higher and basically constant along the wage distribution. We also provide evidence that unions might represent one of the driver of our findings.

Suggested Citation

  • Alessia Matano & Paolo Naticchioni, 2017. "The Extent of Rent Sharing along the Wage Distribution," IREA Working Papers 201704, University of Barcelona, Research Institute of Applied Economics, revised Feb 2017.
  • Handle: RePEc:ira:wpaper:201704
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    References listed on IDEAS

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    Cited by:

    1. Hirsch, Boris & Müller, Steffen, 2018. "Firm Wage Premia, Industrial Relations, and Rent Sharing in Germany," IZA Discussion Papers 11309, Institute for the Study of Labor (IZA).

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    Keywords

    Rent Sharing; Wage Distribution; Quantile Regressions; IV Quantile regressions; Quantile fixed effects regressions. JEL classification: C33; J31; J41; L25.;

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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