TY  - RPRT
        AU  - Gruetter, Max
AU  - Lalive, Rafael
        TI  - The Importance of Firms in Wage Determination
        PY  - 2004/Oct/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 1367
        UR  - https://www.iza.org/publications/dp1367
        AB  - Firms are central to many theories of the labor market. However, the extent to which firms
affect wages has only recently been explored using matched employer-employee data. This
paper investigates (i) the importance of firms in explaining wage differences across
individuals and industries, and (ii) how the nature of interfirm mobility – job-to-job vs. job-unemployment-job – affects the relative importance of firms and workers in wage
determination. Results indicate that (i) firms are much more important in explaining the
variance of average wages across industries rather than individuals, and (ii) using job-to-job
transitions reduces the importance of firm wage policies in explaining differences.
        KW  - matched employer employee data
KW  - interfirm mobility
KW  - wage determination
KW  - industry wage differentials
        ER  -