Abstract
Analogous to the well-documented firm size-wage differential there also exists a differential in layoff risk according to firm size. Using Austrian data I discuss several reasons for this puzzle, including on-the-job training and workers' heterogeneity. If less stable (and also less able) workers select themselves into small, unstable and low paying firms, predicted layoff risk of workers can be used as a proxy for heterogeneity of workers and therefore be included in wage regressions. Doing this, one-third of the size earnings premium can be explained.
| Original language | English |
|---|---|
| Pages (from-to) | 474-486 |
| Number of pages | 13 |
| Journal | Economic Inquiry |
| Volume | 39 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - Jul 2001 |
Fields of science
- 405002 Agricultural economics
- 502 Economics
- 502001 Labour market policy
- 502002 Labour economics
- 502003 Foreign trade
- 502009 Corporate finance
- 502010 Public finance
- 502012 Industrial management
- 502013 Industrial economics
- 502018 Macroeconomics
- 502020 Market research
- 502021 Microeconomics
- 502025 Econometrics
- 502027 Political economy
- 502039 Structural policy
- 502042 Environmental economics
- 502046 Economic policy
- 502047 Economic theory
- 504014 Gender studies
- 506004 European integration
- 507016 Regional economy
- 303010 Health economics
