Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/264393 
Year of Publication: 
2022
Series/Report no.: 
IWH Discussion Papers No. 19/2022
Publisher: 
Halle Institute for Economic Research (IWH), Halle (Saale)
Abstract: 
We present causal evidence on the rent-sharing elasticity of German manufacturing firms. We develop a new firm-level Bartik instrument for firm rents that combines the firms' predetermined energy input mix with national energy carrier price changes. Reduced-form evidence shows that higher energy prices depress wages. Instrumental variable estimation yields a rent-sharing elasticity of approximately 0.20. Rent-sharing induced by energy price variation is asymmetric and driven by energy price increases, implying that workers do not benefit from energy price reductions but are harmed by price increases. The rent-sharing elasticity is substantially larger in small (0.26) than in large (0.17) firms.
Subjects: 
Bartik instrument
energy prices
rent-sharing
wage inequality
JEL: 
C26
J30
P18
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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