This paper develops a simple equilibrium model of CEO pay. CEOs have different talents and are matched to firms in a competitive assignment model. In market equilibrium, a CEO’s pay changes one for one with aggregate firm size, while changing much less with the size of his own firm. The model determines the level of CEO pay across firms and over time, offering a benchmark for calibratable corporate finance. The sixfold increase of CEO pay between 1980 and 2003 can be fully attributed to the six-fold increase in market capitalization of large US companies during that period. We find a very small dispersion in CEO talent, which nonetheless justifies large pay differences. The data broadly support the model. The size of large fi rms explains many of the patterns in CEO pay, across firms, over time, and between countries. (JEL D2, D3, G34, J3)

/pdf/why-has-ceo-pay-increased-so-much-4wfm2lyooz.pdf

Why has CEO Pay Increased So Much

Economics Of Discrimination

We study the role of establishment-speci…c wage premiums in generating recent increases in West German wage inequality. Models with additive …xed eects for work- ers and establishments are …t in four sub-intervals spanning the period from 1985 to 2009. We show that these models provide a good approximation to the wage struc- ture and can explain nearly all of the dramatic rise in West German wage inequality. Our estimates suggest that the increasing variability of West German wages has arisen from a combination of rising heterogeneity between workers, rising variability in the wage premiums at dierent establishments, and increasing assortativeness in the as- signment of workers to plants. In contrast, the idiosyncratic job-match component of wage variation is small and stable over time. Decomposing changes in mean wages between dierent education groups, occupations, and industries, we …nd that increas- ing plant-level heterogeneity and rising assortativeness in the assignment of workers to establishments explain a large share of the rise in inequality along all three dimensions.

/pdf/workplace-heterogeneity-and-the-rise-of-west-german-wage-1hrg7lvk4w.pdf

Workplace Heterogeneity and the Rise of West German Wage Inequality

aeo Introduction aeo The Five Factors aeo Consistent HR Practices: The Whole Can Be More Than the Sum of the Parts aeo Employment and Economics aeo Employment as a Social Relation aeo Voice: Unions and Other Forms of Employee Representation aeo Employment, Society, and the Law aeo Internal Labor Markets aeo High--Commitment HR aeo Performance Evaluation aeo Pay for Performance aeo Compensation Systems: Forms, Bases, and Distribution of Rewards aeo Job Design aeo Staffing and Recruitment aeo Training aeo Promotion and Career Concerns aeo Downsizing aeo Outsourcing aeo HRM in Emerging Companies aeo Organizing HR Appendix A: Transaction Cost Economics Appendix B: Reciprocity and Reputation in Repeated Interactions Appendix C: Agency Theory Appendix D: Market Signaling and Screening

战略人力资源 : 总经理的思考框架 = Strategic human resources : frameworks for general managers

Urban density and the rate of invention

Cities, matching and the productivity gains of agglomeration

This paper presents a new approach to the measurement of the effects of spatial mismatch that takes advantage of matched employer-employee administrative data integrated with a person-specific job accessibility measure, as well as demographic and neighborhood characteristics. We focus on a group who are job searchers for plausibly exogenous reasons: lower-income workers with strong labor force attachment separated during a mass layoff. Our results support the spatial mismatch hypothesis. We find that better job accessibility significantly decreases the duration of joblessness among lower-income displaced workers and especially for Blacks, females, and older workers. JEL Codes: J64, R23, R41.

/pdf/job-displacement-and-the-duration-of-joblessness-the-role-of-3439aebhqj.pdf

Job Displacement and the Duration of Joblessness: The Role of Spatial Mismatch

To what extent do immigrants and the native-born work in separate workplaces? Do worker and employer characteristics explain the degree of workplace concentration? We explore these questions using a matched employer-employee database that extensively covers employers in selected MSAs. We find that immigrants are much more likely to have immigrant coworkers than are natives, and are particularly likely to work with their compatriots. We find much higher levels of concentration for small businesses than for large ones, that concentration varies substantially across industries, and that concentration is particularly high among immigrants with limited English skills. We also find evidence that neighborhood job networks are strongly positively associated with concentration. The effects of networks and language remain strong when type is defined by country of origin rather than simply immigrant status. The importance of these factors varies by immigrant country of origin—for example, not speaking English well has a particularly strong association with concentration for immigrants from Asian countries. Controlling for differences across MSAs, we find that observable employer and employee characteristics account for about half of the difference between immigrants and natives in the likelihood of having immigrant coworkers, with differences in industry, residential segregation and English speaking skills being the most important factors.

/pdf/workplace-concentration-of-immigrants-18wsd9hm77.pdf

Workplace Concentration of Immigrants

Where Are All the Good Jobs Going?: What National and Local Job Quality and Dynamics Mean for U.S. Workers

Substantial immigrant segregation in the United States, combined with the increase in the share of the U.S. foreign-born population, have led to great interest in the causes and consequences of immigrant concentration, including those related to the functioning of labor markets. This paper provides robust evidence that both the size and the quality of an immigrant enclave affects the labor market outcomes of new immigrants. We develop new measures of the quality, or information value, of immigrant networks by exploiting data based on worker earnings records matched to firm and Census information. We demonstrate the importance of immigrant employment links: network members are much more likely than other immigrants to be employed in the same firm as their geographic neighbors. Immigrants living with large numbers of employed neighbors are more likely to have jobs than immigrants in areas with fewer employed neighbors. The effects are quantitatively important and robust under alternative specifications. For example, in a high value network – one with an average employment rate in the 90th percentile – a one standard deviation increase in the log of the number of contacts in the network is associated with almost a 5% increase in the employment rate. Earnings, conditional on employment, increase by about 0.7%.

https://www.econstor.eu/bitstream/10419/36293/1/613040880.pdf

Fredrik Andersson

Papers

Cities, matching and the productivity gains of agglomeration

Job Displacement and the Duration of Joblessness: The Role of Spatial Mismatch

Workplace Concentration of Immigrants

Where Are All the Good Jobs Going?: What National and Local Job Quality and Dynamics Mean for U.S. Workers

Do as the Neighbors Do: The Impact of Social Networks on Immigrant Employment