@TechReport{iza:izadps:dp17039,
            	author={Reyes, Germán},
            	title={Coarse Wage-Setting and Behavioral Firms},
            	year={2024},
	month={May},
            	institution={Institute of Labor Economics (IZA)},
            	address={Bonn},
            	type={IZA Discussion Paper},
            	number={17039},
            	url={https://www.iza.org/publications/dp17039},
	abstract={This paper shows that the bunching of wages at round numbers is partly driven by firm coarse wage-setting. Using data from over 200 million new hires in Brazil, I first establish that contracted salaries tend to cluster at round numbers. Then, I show that firms that tend to hire workers at round-numbered salaries have worse market outcomes. Next, I develop a wage-posting model in which optimization costs lead to the adoption of coarse rounded wages and provide evidence supporting two model predictions using two research designs. Finally, I examine some consequences of coarse wage-setting for relevant economic outcomes.},
	keywords={bunching at round numbers;behavioral firms;wage-setting},
            }