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Title:Wage premia for newly hired employees: Theory and evidence PDF Logo
Authors:Kampkötter, Patrick
Sliwka, Dirk
Issue Date:2011
Series/Report no.:Discussion paper series // Forschungsinstitut zur Zukunft der Arbeit 5538
Abstract:We investigate wage differences between newly hired and incumbent employees. We show in a formal model that when employees care for wages as well as match-specific utility, incumbents earn less than new recruits if and only if firm-specific human capital is not too important. The existence and structure of these wage premia is then investigated empirically using detailed personnel data from a large number of banks. We find that, on average, new hires earn more than comparable incumbent colleagues on the same job. But the size of the wage premia varies between jobs and indeed strongly depends on a measure of human capital specificity.
Subjects:wages
job mobility
wage premia
human capital
new hires
JEL:J31
J44
J62
Persistent Identifier of the first edition:urn:nbn:de:101:1-201104133406
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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