What Accounts for Intra-Industry Wage Differentials? Results from a Survey of Establishments

David Fairris and Erik Jonasson

Journal of Economic Issues, 2008, vol. 42, issue 1, 97-114

Abstract: This paper utilizes an original establishment survey in a select few low-wage industries in Los Angeles to draw conclusions about the existence of and explanations for intra-industry wage differentials. We explore differences in average establishment wages but also in the starting wage of the largest low-wage occupations in establishments. Well over 50 percent of the variation in average establishment wages occurs across establishments within industries and 60 percent or more of the starting occupational wages of establishments occurs both within industries and occupations. Differences in the skills of workers account for a portion of the variation in intra-industry average and intra-occupational starting wages, but so too do institutional factors such as unions, rent sharing, monitoring difficulty, and recruitment difficulty.

Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:mes:jeciss:v:42:y:2008:i:1:p:97-114

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DOI: 10.1080/00213624.2008.11507116

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