Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/30238
Authors: 
Pfeifer, Christian
Year of Publication: 
2009
Series/Report no.: 
University of Lüneburg Working Paper Series in Economics 151
Abstract: 
Hutchens (1986, Journal of Labor Economics 4(4), pp. 439-457) argues that deferred compensation schemes impose fixed-costs to firms and, therefore, they employ older workers but prefer to hire younger workers. This paper shows that deferred compensation can be a recruitment barrier even without these fixed-costs, because adjustments of wage-tenure profiles for older new entrants can lead to adverse incentive effects from a fairness perspective. A personnel data set and a linked employeremployee data set reveal that wage-tenure profiles of white-collar workers are indeed adjusted according to entry age but that firms still hire few older workers.
Subjects: 
Deferred compensation
entry age
fairness
internal labor markets
wages
JEL: 
J14
J31
J33
M51
M52
Document Type: 
Working Paper

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