Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/33212
Authors: 
Fakhfakh, Fathi
FitzRoy, Felix R.
Year of Publication: 
2005
Series/Report no.: 
IZA Discussion Papers 1622
Abstract: 
This paper uses a panel of about 6000 French establishments to test some implications of the modern theory of dynamic monopsony or upward sloping labour supply curves for average firm wages. Panel estimates provide strong evidence of a much larger long run employer size - wage effect (ESWE) than found previously, while controlling for worker quality and compensating differentials with lagged wages, and for profitability (rent sharing). Employment expansion also has a positive effect on wages, providing further evidence for upward sloping labour supply (as distinct from the effect of shocks in a perfectly competitive labour market).
Subjects: 
labour supply
dynamic monopsony
firm-size wage effect
JEL: 
C23
J30
J31
Document Type: 
Working Paper

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