Are Occupations Paid What They Are Worth? An Econometric Study of Occupational Wage Inequality and Productivity

Stephan Kampelmann and Francois Rycx

No 5951, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Labour economists typically assume that pay differences between occupations can be explained with variations in productivity. The empirical evidence on the validity of this assumption is surprisingly thin and subject to various potential biases. The authors use matched employer-employee panel data from Belgium for the years 1999-2006 to examine occupational productivity-wage gaps. They find that occupations play distinct roles for remuneration and productivity: while the estimations indicate a significant upward-sloping occupational wage-profile, the hypothesis of a flat productivity-profile cannot be rejected. The corresponding pattern of over- and underpayment stands up to a series of robustness tests.

Keywords: labour productivity; wages; occupations; production function; matched employer-employee data (search for similar items in EconPapers)
JEL-codes: J24 J31 J44 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2011-09
New Economics Papers: this item is included in nep-eff and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published - published in: De Economist, 2012, 160 (3), 257-287

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Related works:
Journal Article: Are Occupations Paid What They are Worth? An Econometric Study of Occupational Wage Inequality and Productivity (2012)
Working Paper: Are occupations paid what they are worth? An econometric study of occupational wage inequality and productivity (2011)
Working Paper: Are occupations paid what they are worth? An econometric study of occupational wage inequality and productivity (2011)
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