The Wage Policy of Firms - Comparative Evidence for the U.S. And Germany from Personnel Data

26 Pages Posted: 6 Nov 2002

See all articles by Christian Grund

Christian Grund

RWTH Aachen University - School of Economics and Business Administration; IZA Institute of Labor Economics

Date Written: October 2002

Abstract

The wage policy of a German and a U.S. firm is comparatively analysed with a focus on the relation between wages and hierarchies. While prior studies examine only one particular firm, in this paper two plants of the same owners with similar production processes in different institutional environments are inspected. Convex wage profiles over the hierarchy levels of both plants are found. The U.S. plant shows considerably higher intensity of intra-firm competition in terms of higher intra-level wage inequality and yearly promotion rate. In contrast, wages are more distinctly attached to hierarchy levels in the German firm, as wage regressions show. The results are discussed in comparison to prior studies.

Keywords: Hierarchies, Intra-firm Wages, Personnel Records

JEL Classification: M52, J31, M12

Suggested Citation

Grund, Christian, The Wage Policy of Firms - Comparative Evidence for the U.S. And Germany from Personnel Data (October 2002). IZA Discussion Paper No. 605. Available at SSRN: https://ssrn.com/abstract=343342

Christian Grund (Contact Author)

RWTH Aachen University - School of Economics and Business Administration ( email )

Aachen
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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