Wage Dispersion Why Are Similar Workers Paid Differently?

Author/creator Mortensen, Dale T. Author
Format Electronic
Publication InfoCambridge : MIT Press
Description160 p. ill 09.000 x 06.000 in.
Supplemental ContentFull text available from eBooks on EBSCOhost
Subjects

SeriesZeuthen Lectures
Summary Annotation Why are workers with identical skills found in both "good" jobs and "bad" jobs? Whyare workers who do similar jobs paid differently, contrary to standard competitive theory?Observable differences in workers doing the same job account for only 30 percent of wage variation.In Wage Dispersion, Dale Mortensen examines the reasons for pay differentials in the other 70percent. He finds that these differentials, or wage dispersion, are largely the result of job searchfriction (which arises when workers do not know the wages offered by all employers) and cross-firmdifferences in wage policy and productivity.Mortensen examines previous theoretical explanations forwage dispersion, testing them against data from a Danish matched employer-employee database. Hebegins by offering a simple one-period model of the problem, then expands this basic modelintertemporally to include the role of on-the-job worker search behavior. Following this, hediscusses theoretical modifications that offer an explanation for the nature of observed wagedispersion, particularly the shape of cross-firm wage distribution. He then examines the hypothesisthat wage policies are determined by profit-maximizing behavior and finds that the Danish data donot support it; he argues that bilateral wage bargaining is the more likely determinant. Finally, hereviews recent work that extends the basic theoretical framework to explain wage dispersion withinfirms.
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Technical detailsMode of access: World Wide Web
Genre/formElectronic books.
ISBN9780262633192
ISBN0262633191 (Trade Paper) Active Record
Standard identifier# 9780262633192
Stock number0262633191 00015994

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