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The Wage Policy of Firms – Comparative Evidence for the U.S. and Germany from Personnel Data

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  • Grund, Christian

    () (RWTH Aachen University)

Abstract

The wage policy of a German and a U.S. firm is comparatively analysed with a focus on the relation between wages and hierarchies. While prior studies examine only one particular firm, in this paper two plants of the same owners with similar production processes in different institutional environments are inspected. Convex wage profiles over the hierarchy levels of both plants are found. The U.S. plant shows considerably higher intensity of intra-firm competition in terms of higher intra-level wage inequality and yearly promotion rate. In contrast, wages are more distinctly attached to hierarchy levels in the German firm, as wage regressions show. The results are discussed in comparison to prior studies.

Suggested Citation

  • Grund, Christian, 2002. "The Wage Policy of Firms – Comparative Evidence for the U.S. and Germany from Personnel Data," IZA Discussion Papers 605, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp605
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    References listed on IDEAS

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    More about this item

    Keywords

    intra-firm wages; personnel records; hierarchies;

    JEL classification:

    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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