Flexible Wages Systems and the Structure of Wages: Evidence from Matched Employer-Employee Data
Thomas K. Bauer
Rhine-Westphalia Institute for Economic Research (RWI-Essen); University of Bochum - Faculty of Economics; Institute for the Study of Labor (IZA)
Government of the Federal Republic of Germany - Institute for Employment Research (IAB)
CEPR Discussion Paper No. 2980
A growing theoretical and empirical literature is concerned with the effects of flexible workplace systems or High Performance Work Organizations (HPWOs) on wages. Existing theoretical literature suggests that these forms of organization should lead to higher inequality across firms, increased segregation of labor markets and decreased within-firm inequality. This Paper makes use of a new employer-employee-linked data set for Germany to examine the labor market effects of flexible workplace systems. Our results suggest that HPWOs increase both across and within firm inequality. We do not find evidence, however, that HPWOs affect their employment structure.
Number of Pages in PDF File: 42
Keywords: Organizational change, employment, linked employer-employee data set, inequality
JEL Classification: J30, L20, O30working papers series
Date posted: October 16, 2001
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