Decomposing the large firm wage premium in Germany

Lochner, Benjamin; Seth, Stefan; Wolter, Stefanie

doi:10.1016/j.econlet.2020.109368

Cited by 16 publications

(14 citation statements)

References 6 publications

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“…Rather, the distribution of wages in larger firms is shifted to the right compared to the distribution of wages in smaller firms. Our measured large firm wage premium is consistent with the existence of a large, economically significant LFWP found in other studies employing alternative data sets (Velenchik, 1997;Gerlach and Hübler, 1998;Schaffner, 1998;Troske, 1999;Winter-Ebmer, 2001;Dobbelaere, 2004;Söderbom et al, 2005;Lehmer and Möller, 2010;Bloom et al, 2018;Colonnelli et al, 2018;Reed and Thu, 2019;Lochner et al, 2020;Porcher et al, 2021).…”

Section: Introductionsupporting

confidence: 90%

Firm Size and the Task Content of Jobs: Evidence from 47 Countries

Vera

Garcia-Brazales

2021

SSRN Journal

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Using a mix of household-and employer-based survey data from 47 countries, we provide novel evidence that workers in larger firms perform more non-routine analytical and interpersonal tasks, even within narrowly defined occupations. Moreover, workers in larger firms rely more on the use of information and communications technologies (ICT) to perform these tasks. We also document a 17% wage premium that workers in larger firms enjoy relative to their counterparts in smaller firms. We find evidence that the firm size gradient in the task content of jobs accounts for around 10% of the large firm wage premium.

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Section: Introductionsupporting

confidence: 90%

Firm Size and the Task Content of Jobs: Evidence from 47 Countries

Vera

Garcia-Brazales

2021

SSRN Journal

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“…In our data, worker mobility is high as we use the universe of German administrative data to estimate the AKM model. Using the same data,Lochner, Seth and Wolter (2020) show that the bias is small and rather constant over time Song et al (2019). draw a similar conclusion using U.S. data.8 For notational convenience, we suppress the dependence of subscript j on worker i and t, such that j = J(i,t).9 As in CHK, the age variable is normalized to 40 years.…”

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confidence: 57%

“…The overall wage variance when considering wage differences within and between establishments is 0.280 in our sample Lochner, Seth and Wolter (2020). report a variance of log daily earnings of 0.291 for the universe of German establishments in the same time period.…”

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confidence: 87%

Measuring Workers’ Financial Incentives

et al. 2020

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We propose a novel measure for workers' financial incentives based on withinestablishment wage differences among similar workers from the same occupation. This measure captures all forms of incentive pay that lead to workeremployer-specific pay premiums, including explicit (e.g., bonuses) and implicit forms (e.g., tournaments). We estimate the measure using a linked workerestablishment-firm dataset that covers 31 million workers in Germany. For validation, we exploit survey-based information on performance pay and variation in monitoring costs due to occupational characteristics, establishment size, and task complexity and show that the measure behaves as theoretically predicted. Applying the measure yields evidence that workers' incentives positively correlate with firms' performance and innovativeness, which supports a positive relationship between incentives and effort.

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“…The same is true for Germany. However, in the U.S. the manufacturing sector has decreased dramatically since the 80s, whereas in Germany it has been relatively stable (see Lochner et al 2020).…”

Section: Comparison To Other Vacancy Studiesmentioning

confidence: 99%

The IAB Job Vacancy Survey: design and research potential

Bossler

Gürtzgen

Kubis

et al. 2020

J Labour Market Res

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This article provides an overview of the IAB Job Vacancy Survey and its research potential. The IAB Job Vacancy Survey is a quarterly establishment survey covering the (un-)satisfied labor demand in Germany. This survey identifies the entire number of vacancies on the German labor market, including those vacancies that are not reported to the Federal Employment Agency. The main questionnaire obtains information about the number and structure of vacancies, future labor demand, the current economic situation and the expected development of participating establishments. In addition, the questionnaire collects information about the last new hiring and the last case of a failed recruitment process. Finally, the questionnaire enquires about employer attitudes and firms’ use of current labor market instruments. The Research Data Centre of the German Federal Employment Agency offers access to the data starting from the survey waves 2000 onwards.

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Decomposing the large firm wage premium in Germany

Cited by 16 publications

References 6 publications

Firm Size and the Task Content of Jobs: Evidence from 47 Countries

Firm Size and the Task Content of Jobs: Evidence from 47 Countries

Measuring Workers’ Financial Incentives

The IAB Job Vacancy Survey: design and research potential

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