Arbeitspapier

Intra-firm wage inequality and firm performance: first evidence from German linked employer-employee-data

Economic theory suggests both positive and negative relationships between intra-firm wage inequality and productivity. This paper contributes to the growing empirical literature on this subject. We combine German employer-employee-data for the years 1995-2005 with inequality measures using the whole wage distribution of a firm and rely on dynamic panel-data estimators to control for unobserved heterogeneity, simultaneity problems and possible state dependence. Our results indicate a relative minor influence of intra-firm wage inequality on firm productivity. If anything, they provide some support for a view suggesting that some inequality may be beneficial, while too much leads to a detrimental effect on productivity.

Language
Englisch

Bibliographic citation
Series: Working Paper Series in Economics ; No. 77

Classification
Wirtschaft
Wage Level and Structure; Wage Differentials
Personnel Economics: Compensation and Compensation Methods and Their Effects
Subject
Lohnstruktur
Vergütungssystem
Produktivität
Panel
Deutschland

Event
Geistige Schöpfung
(who)
Braakmann, Nils
Event
Veröffentlichung
(who)
Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre
(where)
Lüneburg
(when)
2008

Handle
Last update
10.03.2025, 11:45 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Braakmann, Nils
  • Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre

Time of origin

  • 2008

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