Job satisfaction and co-worker wages: Status or signal?

Andrew Clark (), Nicolai Kristensen () and Niels Westergård-Nielsen
Authors registered in the RePEc Author Service: Niels Westergaard-Nielsen ()

PSE Working Papers from PSE (Ecole normale supérieure)

Abstract: This paper uses matched employer-employee panel data to show that individual job satisfaction is higher when other workers in the same establishment are better-paid. This runs contrary to a large literature which has found evidence of income comparisons in subjective well-being. We argue that the difference hinges on the nature of the reference group. We here use co-workers. Their wages not only induce jealousy, but also provide a signal about the worker's own future earnings. Our positive estimated coefficient on others' wages shows that this positive future earnings signal outweighs any negative status effect. This phenomenon is stronger for men, and in the private sector.

New Economics Papers: this item is included in nep-bec, nep-hap and nep-lab
Date: 2007
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Related works:
Working Paper: Job Satisfaction and Co-worker Wages: Status or Signal? (2007)
Journal Article: Job Satisfaction and Co-worker Wages: Status or Signal? (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:pse:psecon:2007-23

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