Firm Heterogeneity in Skill Returns

Michael Boehm, Khalil Esmkhani and Giovanni Gallipoli ()

No 15480, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We quantify firm heterogeneity in skill returns and present direct evidence of worker–firm complementarities. Using population data linked with cognitive and noncognitive skill measures, we estimate a model of firm-specific returns to these attributes. We find evidence of significant return heterogeneity, sorting, and earnings convexification: (1) Skills command different returns across employers; returns to the two skills correlate weakly within-firm. (2) Workers with large endowments of a skill populate firms with higher returns to it. Sorting intensity grows with cross-sectional dispersion of that skill return. (3) Complementarities and sorting have nonmonotonic effects, raising both level and skewness of earnings.

Keywords: Firm heterogeneity; Skill returns; Sorting; Earnings distribution (search for similar items in EconPapers)
JEL-codes: E24 J23 J24 J31 (search for similar items in EconPapers)
Date: 2022-05
New Economics Papers: this item is included in nep-bec and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Firm Heterogeneity in Skill Returns (2023)
Working Paper: Firm Heterogeneity in Skill Returns (2020)
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