Changes in Managerial Pay Structures 1986-1992 and Rising Returns to Skill
David I. Levine
University of California, Berkeley - Economic Analysis & Policy Group
K. C. O'Shaughnessy
Western Michigan University - Haworth College of Business
University of Pennsylvania Wharton School - Center for Human Resources; National Bureau of Economic Research (NBER); University of Pennsylvania - Management Department
UC Berkeley Working Paper No. 67
We analyze a database with information on wages and skills across firms in a sample of over 50,000 managers between 1986 and 1992. Our measure of skills and responsibility is an unusually good measure of human capital. We find that wage inequality increased both within and between firms between 1986 and 1992. Higher returns to our measure of skill accounts for most of the increasing inequality within firms. At the same time, our measure of skill does not explain much of the differences in average wages between employers, and changes in returns to skill do not explain any of the increase in between-firm variation over time.
Number of Pages in PDF File: 40
JEL Classification: J31, J33working papers series
Date posted: September 1, 1998
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