Firm Heterogeneity and Worker Self-Selection

David Margolis

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Abstract: The author develop a model under which workers with diffferent marginal productivities self-selected into arms based on the arm's seniority reward policy. He shows how this may bias upwards the estimates of returns to seniority into cross-sectional and even some longitudinal studies, when differences in workforce composition are ignored. He develops a new estimator of true returns to seniority and empirically test the implications of the model and shows how several previous estimation particularly in arms that offer zero or negative returns to job seniority, using a large longitudinal sample of French arms and workers.

Keywords: Worker heterogeneity; Firm heterogeneity; Returns to seniority (search for similar items in EconPapers)
Date: 1996-12
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Published in NBER conference "What Do Employers Do ? The Roles of Firms in Internal and External Labor Markets", Dec 1996, Cambridge, Massachussetts, United States

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00378094

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