Returns to Type or Tenure?

Roland A. Amann () and Tobias Klein
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Roland A. Amann: University of Konstanz

No 2773, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We analyze the joint determination of wage levels, wage growth and firm tenure. Our analysis is built on estimating a reduced form for tenure, a structural wage level equation and a structural wage growth equation. We disentangle returns to a latent type variable from estimates of general returns to tenure and wage gains from job changes. This type is related to unobservable match quality that is allowed to vary over time and to be correlated with the returns to tenure. The obtained results for Germany indicate that the type plays a crucial role in the remuneration of employees. Those types who change jobs more often obtain steeper wage profiles but earn less on average.

Keywords: nonseparable model; wage growth; control function approach; unobserved heterogeneity; returns to tenure (search for similar items in EconPapers)
JEL-codes: J31 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2007-05
New Economics Papers: this item is included in nep-bec and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published - published in: Journal of the Royal Statistical Society, Series A (Statistics in Society), 2012, 175 (1), 153 - 166

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Related works:
Journal Article: Returns to type or tenure? (2012)
Working Paper: Returns to type or tenure? (2012)
Working Paper: Returns to Type or Tenure? (2011)
Working Paper: Returns to Type or Tenure? (2011)
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