Wages,Health Insurance and Pension Plans: The Relationship Between Employee Compensation and Small Business Owner Income

Small business owners claim that their ability to provide higher wages and more frequent employee health insurance and pension benefits is severely constrained by the profitability of their firms. This paper examines the proposition that employee wage levels, provision of employee health insurance, and sponsorship of an employee pension plan are associated with small business owner income. A large trade-association survey supplies the data for the inquiry. Regression analysis (OLS and logistic) demonstrates that all three forms of employee compensation are tied to business owner income. Further, the business owner income variable "washes out" the generally accepted relationship between size of business and wages, though not the relationships between size of the business and the presence of health insurance nor between the size of business and the presence of pension benefits. The regressions also indicate that unit costs of health insurance and pension benefits are higher for those employing 10 or fewer and 20 or fewer respectively compared the other small businesses.     

Union impact on wages and fringe benefits of hospital nonprofessionals

Union effects on the wages and fringe benefits of nonprofessionals are estimated for a sample of hospitals in three midwestern states. Survey questionnaire, personal interviews, and published data are combined to determine both the compensation gains of unionized workers and the "spillover" effects on nonunion workers in unionized hospitals. The results of this analysis suggest that overall union effects on total compensation are in the order of 6 to 7 percent for both groups.     

Effort Elicitation,Wage Differentials and Income Distribution in A Wage‐Led Growth Regime

Motivated by the empirical evidence on endogenous labor effort and wage differentials, this paper explores implications for distribution and growth of firms using different strategies to elicit effort from workers. The frequency distribution of effort‐elicitation strategies across firms is governed by a replicator dynamic that generates wage differential as a long‐run equilibrium. Although firms willing to elicit more effort have to compensate workers with a higher wage rate, a larger proportion of firms adopting such strategy will not necessarily produce a higher wage share and thereby a higher growth rate. The intuition is that, depending on the accompanying rise in labor productivity, the wage share may not vary positively with the proportion of firms paying higher wages.     

农民工与城市职工的工资差异及其分解――人力资本与歧视的贡献

文章关注城市职工和农民工两个群体工资差异的大小和来源。利用CGSS2013数据和均值分解法,文章考察了人力资本和歧视的贡献。研究发现：在实现就业以后,两个群体的工资差异主要来自于特征差异,歧视并不是一个十分严重的问题;对农民工群体的歧视主要存在于就业实现的过程中,就业歧视解释了两个群体大约一半的工资差异;教育从特征差异、回报率差异、就业概率差异三个方面为工资差异做出了贡献;工作经验在工资决定中具有逆歧视作用。我们的研究意味着,要缩小两个群体的工资差异必须从缩小前市场差别开始,并通过促进市场竞争、明确歧视的实践标准、简化反歧视的诉讼程序等措施来减少就业歧视的贡献。     

Foreign direct investment and wages: a cross-country analysis

While globalization has led to overall economic growth in a number of countries, questions abound on its distributional effects, especially on rising wage inequality across nations. The main objective of this study is to investigate empirically the effects of foreign direct investment (FDI) on wages in a cross-country setting. We investigate the general equilibrium propositions that capital inflows (outflows) increase (lower) wages in host (home) countries due to the change in relative factor endowments. We also explore whether capital inflows have differential impacts on skilled and unskilled wages in developing economies. Time-series data on 26 countries, 15 developed and 11 developing, are used to fit the labour share equation derived from a translog GNP function with net FDI stock as one of its arguments. Results confirm that capital movement brings about a cross-country convergence of wages. However, there is some evidence that inward FDI flows increase the wage gap between skilled and unskilled workers in developing countries.     

Evaluating the foreign ownership wage premium using a difference-in-differences matching approach

This paper seeks to identify the causal effect of foreign acquisitions on wages of skilled and unskilled workers, using difference-in-differences propensity score matching estimators. Our results suggest that there is substantial heterogeneity in the post-acquisition wage effect depending on the nationality of the foreign acquirer and the skill group of workers. We find sizable post acquisition wage effects on skilled and unskilled wages following an acquisition by a US firm. No such impacts result from acquisitions by EU multinationals. Also we discern some positive wage effects for unskilled workers resulting from acquisitions by multinationals from the rest of the world.     

A study of living wage effects on employees' performance‐related attitudes and behaviour

Despite the surge of interest in living wage research, most studies pay little attention to the effect of living wages on employee attitudes and behaviour. We examine the differences between living wage and minimum wage workers on three attitudinal and behavioural outcomes: affective commitment, organizational citizenship behaviour (OCB), and turnover intention. We also examine the effects of training and benefits on the three outcomes. Results show that living wage workers have higher affective commitment and lower turnover intention. Training and benefits also improve workers' attitudinal and behavioural outcomes variously. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

Foreign Wage Premium,Gender and Education: Insights from Vietnam Household Surveys

This paper investigates the differential impacts of foreign ownership on wages for different types of workers (in terms of educational background and gender) in Vietnam using the Vietnam Household Living Standards Surveys of 2002 and 2004. Whereas most previous studies have compared wage levels between foreign and domestic sectors using firm‐level data (thus excluding the informal sector), one advantage of using the Living Standards Surveys in this paper is that the data allow wage comparison analyses to extend to the informal wage sector. A series of Mincerian earnings equations and worker‐specific fixed effects models are estimated. Several findings emerge. First, foreign firms pay higher wages relative to their domestic counterparts after controlling for workers' personal characteristics. Second, the higher the individual workers' levels of education, the larger on average are the wage premiums for those who work for foreign firms. Third, longer hours of work in foreign firm jobs relative to working in the informal wage sector are an important component of the wage premium. Finally, unskilled women experience a larger foreign wage premium than unskilled men, reflecting the low earning opportunities for women and a higher gender gap in the informal wage sector.     

Wages and foreign ownership A comparative study of Mexico, Venezuela, and the United States

This paper explores the relationship between wages and foreign investment in Mexico, Venezuela, and the United States. Despite very different economic conditions and levels of development, we find one fact that is robust across all three countries: higher levels of foreign investment are associated with higher wages. However, in Mexico and Venezuela, foreign investment is associated with higher wages only for foreign-owned firms — there is no evidence of wage spillovers leading to higher wages for domestic firms. The lack of spillovers in Mexico and Venezuela is consistent with significant wage differentials between foreign and domestic enterprises. In the United States, where the evidence suggests some wage spillovers from foreign to domestic enterprises, wage differentials are smaller.     

Union-Nonunion Gender Wage and Benefit Differentials across Establishment Sizes

Based on data from the National Longitudinal Surveys of Youth (NLSY), both male and female workers in larger establishments receive not only higher wages but also have a higher probability of receiving benefits than those in smaller establishments. This phenomenon reinforces the well documented size effect. This study also provides evidence of vast gender differences in estimated union effects on the different components of the compensation structure. Hence unions should not treat both genders similarly with respect to wages and benefits. Specifically, unions may be successful in attracting more female workers to join rank and file if unions could play an active role in making available maternity (paternity) leave, and also provided opportunities for women to join large establishments.     

Wage Effects of Trade Reform with Endogenous Worker Mobility

In this paper, we use a linked employer–employee database from Brazil to evaluate the wage effects of trade reform. With an aggregate (firm-level) analysis of this question, we find that a decline in trade protection is associated with an increase in average wages in exporting firms relative to domestic firms, consistent with earlier studies. However, using disaggregated, employer–employee level data, and allowing for the endogenous assignment of workers to firms due to match-specific productivity, we find that the premium paid to workers at exporting firms is economically and statistically insignificant, as is the differential impact of trade openness on the wages of workers at exporting firms relative to otherwise identical workers at domestic firms. We also find that workforce composition improves systematically in exporting firms, in terms of the combination of worker ability and the quality of worker–firm matches, post-liberalization. These results stand in stark contrast to the findings reported in many earlier studies and underscore the importance of endogenous matching and, more generally, non-random labor market allocation mechanisms, in determining the effects of trade policy changes on wages.     

Vor der Bundestagswahl: Argumente für Mindestlöhne überzeugen nicht

For the first time ever, all political parties represented in the German Bundestag are proposing some form of minimum wage regulation in their federal campaigns. After sketching an overview of the vast empirical literature on the employment effects of minimum wages, which has yet to come to a consensus, the paper concentrates on the most common theoretical arguments for the view that minimum wages need not reduce the employment levels of affected workers. The authors find that those arguments are either conceptually inconsistent or assume market characteristics that can hardly describe the reality of low-wage labour markets. In the end, minimum wages are a blunt instrument to reduce poverty among workers — its primary objective — because it benefits many that are not poor and does not address the most important determinant of poverty in Germany, namely unemployment.     

Multinational enterprises and domestic wages: The contingent effect of skill composition

While previous literature has extensively shown that foreign-owned firms pay higher wages than domestically owned firms, the examination of intra-industry wage spillovers between foreign-owned and domestic companies has received much less attention, particularly among non-core EU economies. In this paper, we contribute to the literature on wage spillovers of foreign multinational enterprises onto domestic firms by considering whether the presence of MNE subsidiaries in the Spanish manufacturing industry affects wages in domestic firms in the same industry. Although no evidence supports the existence of wage spillovers from MNEs onto domestic firms on aggregate, we show that the effect of this outside presence on domestic wages is significantly more positive in step with the higher level of workers’ skills in domestic firms. Because only workers in domestic firms with a highly skilled workforce will benefit from wage spillovers from the foreign firm presence in the industry, policy makers need bear in mind that not all FDI will automatically generate spillover benefits to domestic firms.     

Trade, wages, and the political economy of trade protection: evidence from the Colombian trade reforms

Worker industry affiliation plays a crucial role in how trade policy affects wages in many trade models. Yet, most research has focused on how trade policy affects wages by altering the economy-wide returns to a specific worker characteristic (i.e., skill or education) rather than through worker industry affiliation. This paper exploits drastic trade liberalizations in Colombia in the 1980s and 1990s to investigate the relationship between protection and industry wage premiums. We relate wage premiums to trade policy in an empirical framework that accounts for the political economy of trade protection. Accounting for time-invariant political economy factors is critical. When we do not control for unobserved time-invariant industry characteristics, we find that workers in protected sectors earn less than workers with similar observable characteristics in unprotected sectors. Allowing for industry fixed effects reverses the result: trade protection increases relative wages. This positive relationship persists when we instrument for tariff changes. Our results are in line with short- and medium-run models of trade where labor is immobile across sectors or, alternatively, with the existence of industry rents that are reduced by trade liberalization. In the context of the current debate on the rising income inequality in developing countries, our findings point to a source of disparity beyond the well-documented rise in the economy-wide skill premium: because tariff reductions were proportionately larger in sectors employing a high fraction of less-skilled workers, the decrease in the wage premiums in these sectors affected such workers disproportionately.     

Das Mindestlohngesetz — Hoffnungen und Befürchtungen

The German government plans to introduce a minimum wage from 2015. This must be understood as a response to the decline in collective bargaining coverage and the marked increase in employment in the low-wage sector. The authors discuss how many workers are affected by this new regulation and whether the minimum wage is too high in relation to the average wage of workers (Kaitz index). They assume that the introduction of a minimum wage in Germany can have a number of effects. It is not possible to forecast all the reactions and behaviour of market participants to handle higher wages and goods prices. Some authors warn that these measures are significant labour market interventions that could have adverse employment effects. They recommend allowing more exemptions from the minimum wage law than intended by the government, especially for young employees and student apprentices. Other authors hope that minimum wages would help to strengthen collective bargaining and stabilise wages. Some authors emphasise that there should be a careful evaluation of the economic effects by scientists.     

Redistribution of Trade Gains in the Presence of Firm and Worker Heterogeneity

Trade gains are unequally distributed; in particular, low‐ability workers lose out in terms of wages and employment probability. In this paper, we investigate the impact of redistribution schemes on aggregate and disaggregate variables. To this end, we built a trade model with trade unions, heterogeneous firms and workers. Three redistribution schemes are distinguished: unemployment benefits financed by either a wage tax, a payroll tax or a profit tax. We find that: (i) all three redistribution schemes reduce output per capita; (ii) but the marginal reduction is lowest in the wage tax funding scenario; and (iii) If the profit tax is used, labour demand for low‐ability workers increases.     

Unemployment,environmental policy,and international migration

In this paper, we investigate the effects of an increase in emission tax, a decrease in fixed manufacturing wage rate, and an increased inflow of foreign workers on competitive wages, the environmental stock, the economic welfare of the representative consumer, and employment in the presence of a pollution abatement equipment sector and unemployment. Our main findings are that an increase in emission tax and a decrease in the urban minimum wage rate decrease unemployment, and international immigration may increase the competitive wage rate, employment rate, stock of environmental capital, and economic welfare of the representative worker.     

Labour market institutions,learning and self-employment

We develop a dynamic partial-equilibrium model to analyse how labour market institutions (wage compression, minimum wages, unemployment benefits, mobility costs and fixed-costs of self-employment) and learning affect who and when people become self-employed. We find that certain ability groups of workers become self-employed for both “carrot” and “stick” reasons: Some prefer self-employment to the low institutionalised wage, while others are not productive enough to qualify for a job at the institutionalised wage. Furthermore, wage compression and learning may give rise to a class of switchers who start in wage employment and later switch to self-employment. Several predictions of the model are consistent with observed empirical regularities, such as the existence of a group of low-skilled self-employed workers, the increasing propensity for self-employment over age groups and the larger spread in earnings among self-employed.     

Do exporters really pay higher wages? First evidence from German linked employer-employee data

Many plant-level studies find that average wages in exporting firms are higher than in non-exporting firms from the same industry and region. This paper uses a large set of linked employer-employee data from Germany to analyze this exporter wage premium. We show that the wage differential becomes smaller but does not completely vanish when observable and unobservable characteristics of the employees and of the workplace are controlled for. For example, blue-collar (white-collar) employees working in a plant with an export-sales ratio of 60% earn about 1.8 (0.9) % more than similar employees in otherwise identical non-exporting plants.     

Wages,Health Insurance Benefits,and Worker Sorting Under Asymmetric Information

Abstract

Employer-sponsored health insurance is the single largest source of health insurance in the USA. In this paper, we explore a model that treats a firm as a de facto insurance company. More specifically, we model a firm as both a producer of goods for an output market and a health insurance company for their employees. The model accounts for the joint provision of wages and health insurance, including the possibility of asymmetric information in employee health status. With this structure, a firm can choose to pay their workers in some combination of cash wages and health insurance. We characterize optimal employment contracts and show that the Rothschild–Stiglitz model results under asymmetric information extend to employer provided insurance. We also find that employment-based insurance offers pooling options that are typically not available when insurance is sold as a standalone product, suggesting a stability to employer-based insurance that is not dependent on the tax system.