Decomposing the large firm wage premium in Germany

Benjamin Lochner, Stefan Seth and Stefanie Wolter
Additional contact information
Stefan Seth: Institute for Employment Research (IAB), Nuremberg, Germany
Stefanie Wolter: Institute for Employment Research (IAB), Nuremberg, Germany

No 202010, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "We use an extensive, matched employer-employee dataset to analyze the employer-size wage relation and its contribution to wage inequality in Germany. Applying models with additive fixed effects for workers and establishments, we document that the large firm wage premium, which has risen over 25 years, has only recently started to decrease. Our estimates show that the recent decline is due to a decrease in the variation of establishment-specific wage premiums both across establishment size groups and within. This decline together with decreasing worker segregation at small firms account for an overall reversal in the trend of increasing wage dispersion." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; Auswirkungen; Betriebsgröße; Einkommenseffekte; Großbetrieb; Kleinbetrieb; Lohnentwicklung; Lohnunterschied; Mittelbetrieb; IAB-Datensatz Linked Personnel Panel; Unternehmensgröße; 1985-2017 (search for similar items in EconPapers)
JEL-codes: J00 J21 J31 J40 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2020-03-24
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published in/as: Economics Letters (2020), Vol. 194, Art. 109368, doi:10.1016/j.econlet.2020.109368

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Journal Article: Decomposing the large firm wage premium in Germany (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:202010

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