Changes in Managerial Pay Structures 1986-1992 and Rising Returns to Skill

UC Berkeley Working Paper No. 67

40 Pages Posted: 1 Sep 1998

See all articles by David I. Levine

David I. Levine

University of California, Berkeley - Economic Analysis & Policy Group

K. C. O'Shaughnessy

Western Michigan University - Haworth College of Business

Peter Cappelli

University of Pennsylvania Wharton School - Center for Human Resources; National Bureau of Economic Research (NBER); University of Pennsylvania - Management Department

Multiple version iconThere are 2 versions of this paper

Date Written: April 1998

Abstract

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.

JEL Classification: J31, J33

Suggested Citation

Levine, David Ian and O'Shaughnessy, K. C. and Cappelli, Peter, Changes in Managerial Pay Structures 1986-1992 and Rising Returns to Skill (April 1998). UC Berkeley Working Paper No. 67. Available at SSRN: https://ssrn.com/abstract=121378 or http://dx.doi.org/10.2139/ssrn.121378

David Ian Levine (Contact Author)

University of California, Berkeley - Economic Analysis & Policy Group ( email )

Berkeley, CA 94720
United States
510-642-1697 (Phone)
510-643-1420 (Fax)

K. C. O'Shaughnessy

Western Michigan University - Haworth College of Business ( email )

Kalamazoo, MI 49008
United States
616-771-9470 (Phone)

Peter Cappelli

University of Pennsylvania Wharton School - Center for Human Resources ( email )

3733 Spruce Street, Vance Hall
Philadelphia, PA 19104-6358
United States

HOME PAGE: http://www.wharton.upenn.edu/faculty/cappelli.html

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

University of Pennsylvania - Management Department ( email )

The Wharton School
Philadelphia, PA 19104-6370
United States

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