Working Paper Series, FIEF - Trade Union Institute for Economic Research
Wage Dispersion and Job Turnover: Evidence from Sweden
Abstract: This paper uses Swedish establishment-level panel data to
test the hypothesis of a positive relation between the degree of wage
compression and job reallocation as proposed by Bertola and Rogerson
(1997). The effect of wage dispersion on job turnover is negative and
significant in the manufacturing sector. The wage com-pression effect is
stronger on job destruction than on job creation, suggesting that wages are
more downward than upward rigid. Further results include (i) a strong
positive relationship between the industry share of temporary employees and
job turnover and (ii) a negative relationship between the amount of
working-time flexibility and job reallocation.
Keywords: Job creation and job destruction; Wage dispersion; Temporary employment contracts; Panel data; (follow links to similar papers)
JEL-Codes: J21; J31; J63; (follow links to similar papers)
28 pages, November 11, 2002
This paper is Chapter 2 of my 2002 Stockholm School of Economics Ph.D. thesis.
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