Coverage by Incremental Scales

Alison Booth and Jeff Frank

No 1097, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper uses the British Household Panel Survey to investigate when seniority is rewarded by automatic incremental scales. Scales are seen as an alternative to individual merit pay. They are likely to be used when individual productivity is hard to measure, when firms provide all workers with similar levels of training and when workers have sufficient bargaining power to gain insurance against mis-measurement in the allocation of merit pay. The data provide support for these hypotheses.

Keywords: Earnings; Merit Pay; Seniority; Unions (search for similar items in EconPapers)
JEL-codes: J31 J33 J41 J51 (search for similar items in EconPapers)
Date: 1994-12
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