Productivity Dispersion, Wage Dispersion and Superstar Firms

Yannick Bormans; Angelos Theodorakopoulos

doi:10.1111/ecca.12490

Productivity Dispersion, Wage Dispersion and Superstar Firms

Yannick Bormans
, Angelos Theodorakopoulos ^*

^*Corresponding author for this work

Katholieke Universiteit Leuven

Research output: Contribution to journal › Article › peer-review

6 Citations (Scopus)

66 Downloads (Pure)

Abstract

Using a rich sample of firms in 14 EU countries from 2000-2016, we confirm increases in productivity dispersion, wage dispersion and superstar firms. Beyond reaffirming an incomplete pass-through from productivity to wages, we present novel empirical evidence of an even weaker pass-through in industries dominated by superstar firms. This effect is observed both in the lower and upper parts of the productivity and wage distributions, and is stronger for tradable (versus non tradable) sectors and markets with low (versus high) collective bargaining power. These findings point to different mechanisms, consistent with theoretical work and various underlying structural changes in the economy.

Original language	English
Pages (from-to)	1145-1172
Number of pages	28
Journal	Economica
Volume	90
Issue number	360
Early online date	19 Jul 2023
DOIs	https://doi.org/10.1111/ecca.12490 https://doi.org/10.1111/ecca.12490
Publication status	Published - Oct 2023

Bibliographical note

Copyright © 2023 The Authors. Economica published by John Wiley & Sons Ltd on behalf of London School of Economics and Political Science. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

Funding: The authors acknowledge support from the European Union Horizon 2020 Research and Innovation action under grant agreement no. 822781, GROWINPRO (Growth Welfare Innovation Productivity) Work Package 3.6 – DE 3.9, and from Methusalem (METH/21/001).

Funding

We thank participants at the KU Leuven and University of Oxford–Oxford Martin School seminars, and the 3rd and 4th conferences on European Studies for their comments and suggestions. Special thanks are extended to Filip Abraham, Giuseppe Berlingieri, Jan De Loecker, Rebecca Freeman, Pete Klenow, Joep Konings, Balazs Murakozy, Werner Roeger and Stijn Vanormelingen. The authors acknowledge support from the European Union Horizon 2020 Research and Innovation action under grant agreement no. 822781, GROWINPRO (Growth Welfare Innovation Productivity) Work Package 3.6 – DE 3.9, and from Methusalem (METH/21/001). This paper circulated previously under the title ‘The link between productivity and wage dispersion: the role of superstar firms’.

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10.1111/ecca.12490Licence: CC BY 4.0
10.1111/ecca.12490

Economica - 2023 - Bormans - Productivity dispersion wage dispersion and superstar firms
This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited. Copyright © 2023 The Authors. Economica published by John Wiley & Sons Ltd on behalf of London School of Economics and Political Science.
Final published version, 910 KBLicence: CC BY 4.0

https://www.oxfordmartin.ox.ac.uk/publications/productivity-wage-dispersion-superstar-firms/

Cite this

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Productivity Dispersion, Wage Dispersion and Superstar Firms

Abstract

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