Sharing economic rents with workers? Evidence from matched employer-employee data in Vietnam

Nobuaki Yamashita

KDI Journal of Economic Policy, 2025, vol. 47, issue 3, 115-128

Abstract: Utilising matched employer-employee data from Vietnamese small and medium enterprises (SMEs) surveys spanning the time frame of 2007-2015, we investigate the extent to which firms share economic rents with their employees through wage adjustments. Our analysis reveals rent-sharing elasticity of 0.08-0.1, demonstrating that small firms with limited market power engage in rent sharing in response to increased economic rents, measured as value added per employee. This rent sharing is prominent if a worker is related to an owner and is engaged in non-production jobs. However, the analysis based on worker panel data indicates caution against interpreting the results as causal evidence.

Keywords: Rent Sharing; Profits; Vietnam; Small and Medium Enterprises (SMEs); Matched Employer-Employee Data (search for similar items in EconPapers)
JEL-codes: J31 J46 O12 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:kdijep:330705

DOI: 10.23895/kdijep.2025.47.3.115

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