Abstract
The analysis of firm-size wage differentials in Germany, using data from the German Socio-Economic Panel, firstly corroborates the finding that wages rise with firm-size and shows that the rank order of mean wages between firm-size classes is stable for the period 1984–1993. Secondly, the most important novel results are as follows: (i) wage differentials between firm-size classes increased during the period investigated after controlling for individual attributes and computing with deflated values; (ii) average levels of the qualification of employees have diverged noticeably between small and large firms; (iii) movers from small to larger firms have to accept wages below the average pay of incumbents with comparable attributes in the new firms: (iv) movers to smaller firms, however, retain a portion of their higher wages in larger firms; and (v) wage differentials between smaller and larger firms decline with increasing unemployment.
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Gerlach, K., HÜBLER, O. Firm Size and Wages in Germany – Trends and Impacts of Mobility. Empirica 25, 245–261 (1998). https://doi.org/10.1023/A:1006904430572
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DOI: https://doi.org/10.1023/A:1006904430572