Job satisfaction and co-worker wages: status or signal?

Andrew Clark, Nicolai Kristensen and Niels Westergaard-Nielsen
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Niels Westergaard-Nielsen: IZA - Institute for the Study of Labor - IZA, Aarhus University [Aarhus]

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Abstract: We use matched employer-employee panel data to show that individual job satisfaction is higher when other workers in the same establishment are better-paid. This runs counter to substantial existing evidence of income comparisons in subjective well-being. We argue that the difference hinges on the nature of the reference group. Here we use co-workers. Their earnings not only induce jealousy but also provide a signal about the worker's own future earnings. In our data, this positive future earnings signal outweighs any negative status effect. This phenomenon is stronger for men and in the private sector but weaker for those nearer retirement.

Date: 2009-03
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Citations: View citations in EconPapers (189)

Published in The Economic Journal, 2009, 119 (536), pp.430-447. ⟨10.1111/j.1468-0297.2008.02236.x⟩

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Related works:
Journal Article: Job Satisfaction and Co-worker Wages: Status or Signal? (2009)
Journal Article: Job Satisfaction and Co‐worker Wages: Status or Signal? (2009)
Working Paper: Job satisfaction and co-worker wages: status or signal? (2009)
Working Paper: Job satisfaction and co-worker wages: Status or signal? (2007)
Working Paper: Job satisfaction and co-worker wages: Status or signal? (2007)
Working Paper: Job Satisfaction and Co-worker Wages: Status or Signal? (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00754388

DOI: 10.1111/j.1468-0297.2008.02236.x

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