Firms and labor market inequality: evidence and some theory

We synthesize two related literatures on firm-level drivers of wage inequality. Studies of rent sharing that use matched worker-firm data find elasticities of wages with respect to value added per worker in the range of 0.05–0.15. Studies of wage determination with worker and firm fixed effects typi...

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Detalles Bibliográficos
Autores: Card, David, Cardoso, Ana Rute, Heining, Joerg, Kline, Patrick
Tipo de recurso: artículo
Estado:Versión publicada
Fecha de publicación:2018
País:España
Institución:Consejo Superior de Investigaciones Científicas (CSIC)
Repositorio:DIGITAL.CSIC. Repositorio Institucional del CSIC
OAI Identifier:oai:digital.csic.es:10261/175215
Acceso en línea:http://hdl.handle.net/10261/175215
Access Level:acceso abierto
Palabra clave:ddc:330
Descripción
Sumario:We synthesize two related literatures on firm-level drivers of wage inequality. Studies of rent sharing that use matched worker-firm data find elasticities of wages with respect to value added per worker in the range of 0.05–0.15. Studies of wage determination with worker and firm fixed effects typically find that firm-specific premiums explain 20% of overall wage variation. To interpret these findings, we develop a model of wage setting in which workers have idiosyncratic tastes for different workplaces. Simple versions of this model can rationalize standard fixed effects specifications and also match the typical rent-sharing elasticities in the literature.