Should Low-Wage Workers Care About Where They Work? Assessing the Impact of Employer Characteristics on Low-Wage Mobility

Nicole Guertzgen () and Anja Heinze

Annals of Economics and Statistics, 2016, issue 121-122, 385-413

Abstract: This paper studies the importance of employer-specific determinants of intra-firm low-wage mobility in Germany. To address the initial conditions problem and the endogeneity of employer retention, we model intra-firm low-pay transitions using a trivariate Probit model that accounts for selection into low-wage employment and non-random employer drop-out. Using data from the LIAB Linked Employer?Employee panel, our results indicate that for male workers from the service sector, the probability of escaping low-pay increases with employer size. This contrasts with female workers from the service sector, who rather benefit from collective bargaining coverage and local works councils. These findings are consistent with internal labour markets being an important ingredient of male within-firm wage growth, whereas the removal of asymmetric information appears to be more relevant in explaining female workers' wage transitions.

Keywords: Wage Mobility; Collective Bargaining Coverage; Trivariate Probit. (search for similar items in EconPapers)
JEL-codes: C23 J31 J51 L13 (search for similar items in EconPapers)
Date: 2016
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.jstor.org/stable/10.15609/annaeconstat2009.121-122.385 (text/html)

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:adr:anecst:y:2016:i:121-122:p:385-413

DOI: 10.15609/annaeconstat2009.121-122.385

Access Statistics for this article

Annals of Economics and Statistics is currently edited by Laurent Linnemer

More articles in Annals of Economics and Statistics from GENES Contact information at EDIRC.
Bibliographic data for series maintained by Secretariat General () and Laurent Linnemer ().