20 Pages Posted: 5 Nov 2001
Date Written: November 2001
The impact of wage increases on job satisfaction are explored. First, it is empirically established that current job satisfaction rises with absolute wage level as well as with wage increases. Second, a basic job satisfaction function is constructed based on the empirical results, and theoretical implications are analyzed. It is shown that the myopic maximization of such a function directly implies increasing and concave shaped age-earnings profiles.
Keywords: Job Satisfaction, Wage Increases, Habit Formation, Age-earnings Profiles
JEL Classification: J28, J30, M12
Suggested Citation: Suggested Citation
Grund, Christian and Sliwka, Dirk, The Impact of Wage Increases on Job Satisfaction - Empirical Evidence and Theoretical Implications (November 2001). IZA Discussion Paper No. 387. Available at SSRN: https://ssrn.com/abstract=289100
By Alex Edmans