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7. November 2012

Seminar

High Wage Workers and High Wage Peers
Leibniz Seminar für Arbeitsmarktforschung (BeNA)

Termin

7. November 2012
6.30 - 8.00 pm

Ort

Gustav-Schmoller-Raum
DIW Berlin im Quartier 110
Room 3.3.002A
Mohrenstraße 58
10117 Berlin

Sprecher*innen

Michele Battisti (Ifo Institute Munich)
Abstract: This paper investigates the effects of coworker characteristics on wages, measured by the average person effect of coworkers in a wage regression. The effect of interest is identified from within-firm changes in workforce composition, controlling for person effects, firm effects, and sector-specific time trends. My estimates are based on a linked employer employee dataset for the population of workers and firms of the Italian region of Veneto for years 1982-2001. I find that a 10-percent increase in the average labour market value of coworkers' skills is associated with a 3.6 percent wage premium. I also find that around one fourth of the wage variation previously explained by unobserved firm heterogeneity is actually due to variation in coworker skills, and that between 10 and 15 percent of the immigrant wage gap can be explained by differences in coworker characteristics.

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