The Impact of Noncompetes on Wages and Job Tenure: New Evidence from NLSY Data

Tristan Potter, André Kurmann and Bart Hobijn

AEA Papers and Proceedings, 2026, vol. 116, 273-277

Abstract: Noncompete agreements (NCAs) are pervasive even in low-wage labor markets, yet most evidence relies on variation in enforceability rather than NCA incidence. Using longitudinal data from the NLSY97, we study how signing an NCA affects wage trajectories and job tenure. Exploiting complete work histories and applying a "clean controls" local projections difference-in-differences design, we find a striking divergence: NCAs are associated with significantly slower wage growth for low-education workers over four years but faster wage growth for high-education workers. Effects on job tenure are imprecisely estimated for both groups.

JEL-codes: J22 J24 J31 J41 J62 (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/pandp.20261078 (application/pdf)
https://www.aeaweb.org/articles/materials/25205 (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:apandp:v:116:y:2026:p:273-277

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/subscribe.html

DOI: 10.1257/pandp.20261078

Access Statistics for this article

AEA Papers and Proceedings is currently edited by William Johnson and Kelly Markel

More articles in AEA Papers and Proceedings from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().