[Journal:] IZA Journal of Labor Economics [ISSN:] 2193-8997 [Publisher:] Springer [Place:] Heidelberg [Volume:] 2 [Year:] 2013 [Pages:] 1-23
This paper explores the evolution of the average wage of employees over the life-cycle of a manufacturing plant. The average wage starts out low for a new plant and increases along with labor productivity as the plant ages. As a plant approaches exit, its average wage falls, but more slowly than it rises in the case of growing plants. Moreover, the average wage does not fall as fast as productivity does. A dynamic model of labor quality and quantity choice by plants is estimated to assess the costs of altering labor quality and quantity over the plant life-cycle.
The average wage of employees# The evolution of the average wage Plant productivity Plant life-cycle Employment dynamics Adjustment costs Manufacturing