The Employment Consequences of Seniority Wages

34 Pages Posted: 6 Aug 2008

See all articles by Thomas Zwick

Thomas Zwick

University of Würzburg - Business Administration & Economics; Centre for European Economic Research (ZEW); Maastricht University - Research Centre for Education and the Labour Market (ROA)

Date Written: 2008

Abstract

This paper combines two strains of the literature on the employment effects of deferred compensation. The first strain separates seniority and job matching wage effects on the basis of individual data, but can not look at employment consequences. The second strain explains the employment structure on the basis of establishment data, but cannot properly calculate seniority wages. This paper uses linked employer-employee data, aggregates individual seniority wages to the establishment level, and correlates them with the establishment employment structure. According to the deferred compensation hypothesis this paper finds that establishments with stronger seniority wages have a higher tenure but hire less older employees.

Keywords: Seniority Wages, Employment Structure, Linked Employer-Employee data

JEL Classification: J14, J21, J31

Suggested Citation

Zwick, Thomas, The Employment Consequences of Seniority Wages (2008). ZEW - Centre for European Economic Research Discussion Paper No. 08-039. Available at SSRN: https://ssrn.com/abstract=1207210 or http://dx.doi.org/10.2139/ssrn.1207210

Thomas Zwick (Contact Author)

University of Würzburg - Business Administration & Economics ( email )

Sanderring 2
Wuerzburg, D-97070
Germany

Centre for European Economic Research (ZEW) ( email )

P.O. Box 10 34 43
L 7,1 D-68161 Mannheim
Germany

Maastricht University - Research Centre for Education and the Labour Market (ROA) ( email )

P.O. Box 616
Maastricht, MD6200
Netherlands

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