1999 Articles
Early Starters versus Late Beginners
We consider a model of wage formation characterized by two features, learning and downward rigidity. We show that wages should exhibit a late‐beginning property: when one controls for the wage at date t, the wage at date t + 1 should be negatively correlated with the wage at date 6–1. We test this property on a sample of about 1,000 executives of a French state‐owned firm whose careers we observe for 15 years. This organization exhibits the features that charecterize internal labor markets; in particular, careers consist of sequences of discrete promotions, a fact that generates specific econometric problems. The results confirm the prediction.
Files
- Chiappori_JPE1999.pdf application/pdf 337 KB Download File
Also Published In
- Title
- Journal of Political Economy
- DOI
- https://doi.org/10.1086/250077
More About This Work
- Academic Units
- Economics
- Published Here
- March 10, 2015