 Rent Sharing Before and After the Wage BillNo 12, Working Papers from Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research Abstract: Many biases plague the analysis of whether employers share rents with their employees, unlike what is predicted by the competitive labour market model. Using a Portuguese matched employer-employee panel, these biases are addressed here in three complementary ways: 1) Controlling directly for the fact that firms that share more rents will, ceteris paribus, have lower net-of-wages profits. 2) Instrumenting profits via interactions between the exchange rate and the share of exports in firms’ total sales. 3) Considering firm or firm/worker spell fixed effects and highlighting the role of downward wage rigidity. These approaches clarify conflicting findings in the literature and result, in our preferred specifications, in significant evidence of rent sharing (a Lester range of pay dispersion of 56%), also shown to be robust to a number of competitive interpretations. Keywords: Rent Sharing; Instrumental Variables; Matched Employer-Employee Data; Fixed Effects. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:cgs:wpaper:12 Access Statistics for this paper More papers in Working Papers from Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research Contact information at EDIRC. |
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