Earnings Dynamics and Firm-Level Shocks

Costas Meghir, Benjamin Friedrich, Lisa Laun and Luigi Pistaferri

No 14240, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We use matched employer-employee data from Sweden to study the role of the firm in affecting the stochastic properties of wages. Our model accounts for endogenous participation and mobility decisions. We find that firm-specific permanent productivity shocks transmit to individual wages, but the effect is mostly concentrated among the high-skilled workers; firm-specific temporary shocks mostly affect the low-skilled. The updates to worker-firm specific match effects over the life of a firm-worker relationship are small. Substantial growth in earnings variance over the life cycle for high-skilled workers is driven by firms accounting for 44% of cross-sectional variance by age 55.

Keywords: Matched; employer; employee; data (search for similar items in EconPapers)
JEL-codes: H51 H55 I18 J26 (search for similar items in EconPapers)
Date: 2019-12
New Economics Papers: this item is included in nep-bec and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (29)

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Related works:
Working Paper: Earnings Dynamics and Firm-Level Shocks (2024)
Working Paper: Earnings dynamics and firm-level shocks (2021)
Working Paper: Earnings Dynamics and Firm-Level Shocks (2019)
Working Paper: Earnings Dynamics and Firm-Level Shocks (2019)
Working Paper: Earnings Dynamics and Firm-Level Shocks (2018)
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