Small Employers, Large Employers and the Skill Premium

Damir Stijepic

Economics Bulletin, 2016, vol. 36, issue 1, 381-387

Abstract: I document the comovement of the skill premium with the differential employer size wage premium between high- and low-skill workers in U.S. manufacturing during the postwar era. For the baseline specification, i.e., establishments with at least 500 employees categorized as large employers and non-production workers as high-skilled, I obtain a correlation coefficient of 0.87. Exploiting variations across subindustries while controlling for other potentially relevant factors, I estimate that an increase by ten log-points in the differential size premium is associated with an increase in the skill premium by three log-points.

Keywords: skill premium; employer size wage premium; differential employer size wage premium between skill groups; wage inequality (search for similar items in EconPapers)
JEL-codes: I2 J3 (search for similar items in EconPapers)
Date: 2016-03-17
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Citations: View citations in EconPapers (7)

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