Worker Productivity and Wages: Evidence from Linked Employer-Employee Data

31 Pages Posted: 15 Dec 2012

See all articles by Ana Sofia Lopes

Ana Sofia Lopes

affiliation not provided to SSRN

Paulino Teixeira

Universidade de Coimbra - Faculdade de Economia; Center for European Economic Research (ZEW)

Abstract

This study compares the determinants of productivity and wages at both firm and worker level. In the firm-level analysis, we follow Hellerstein, Neumark and Troske (1999) and provide improved estimates based on an extended set of covariates including the intensity of firm-provided training. In the worker-level analysis we take a new turn and generate a proxy for unobserved worker productivity. Our results point to the presence of sizeable spillover effects from schooling and training as their impact is bigger on firm-level productivity equations than on the corresponding worker-level equations. In turn, our fully disaggregated model at worker level shows that, by using all possible combinations of worker attributes, we obtain that the wage differences across different worker groups are mostly productivity based and that the gap can be as high as 33%.

Keywords: worker productivity, wages, human capital, LEED

JEL Classification: C23, D24, J31

Suggested Citation

Lopes, Ana Sofia and Teixeira, Paulino, Worker Productivity and Wages: Evidence from Linked Employer-Employee Data. IZA Discussion Paper No. 7036, Available at SSRN: https://ssrn.com/abstract=2189774

Ana Sofia Lopes

affiliation not provided to SSRN

Paulino Teixeira

Universidade de Coimbra - Faculdade de Economia ( email )

Av. Dias da Silva, 165
Coimbra, 3004-512
Portugal

Center for European Economic Research (ZEW) ( email )

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

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