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Within-Firm Pay Inequality and Productivity / Melanie Wallskog, Nicholas Bloom, Scott W. Ohlmacher, Cristina Tello-Trillo.
- Format:
- Book
- Author/Creator:
- Wallskog, Melanie.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w32240.
- NBER working paper series no. w32240
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2024.
- Summary:
- Combining confidential Census worker and firm data, we find three key results. First, employees at more productive firms earn higher pay at all earnings levels. Second, this pay-productivity relationship strengthens with seniority, doubling from an elasticity of 0.07 for pay on productivity for the median-paid employee to 0.15 for the top-paid employee. Consequently, more productive firms have higher within-firm inequality. Our data suggests this is driven by their greater adoption of aggressive performance-pay bonus and management schemes. Finally, the magnitude of this pay-performance slope suggests rising productivity can explain 40% of the rise in within-firm inequality since 1980.
- Notes:
- Print version record
- March 2024.
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