Ownership and wages: Spatial econometric approach

Marko Ogorevc and Miroslav Verbič

MPRA Paper from University Library of Munich, Germany

Abstract: The aim of our paper is to disentangle the relationship between ownership and wages using cross-section data for Slovenian medium size and large companies, where we account for spatial dependencies in wage determination. Space here is not considered in geographical context, but as a set of relations between firms originating from the same owner. Using a detailed database on Slovenian ownership, we apply a spatial econometric approach to detect any ownership-based wage spillovers, while accounting for different standard factors, such as size, capital intensity and productivity, and also some ownership-based variables, such as ownership concentration and ratio of cash-flow to control rights. Our results indicate that ownership is an important factor in explaining differences in wage levels. Many large owners divert cash-flow into their own pockets which has a detrimental effect on wages and indicates that this behaviour induced by owners is not sustainable.

Keywords: spatial econometrics; ownership; wage differentials; sustainability (search for similar items in EconPapers)
JEL-codes: C21 G32 J31 (search for similar items in EconPapers)
Date: 2012-05
New Economics Papers: this item is included in nep-geo, nep-lab, nep-lma and nep-ure
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Related works:
Journal Article: Ownership and wages: spatial econometric approach (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:38915

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