CRIEFF Discussion Paper Number 0203
Basic wages and firm characteristics:
Rent-sharing in French Manufacturing
Fathi Fakhfakh and Felix FitzRoy
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Abstract
This paper shows that firm profits (and losses) are strongly related to
individual hourly basic wages for most employees, as well as to the total
earnings measures that have been used previously but are correlated with
working time. Capital intensity is independently important without reducing
the significance of profits as in other studies. Our estimated basic wage-profit
elasticity of one to two percent in the presence of numerous individual and
firm controls is of similar magnitude to the female collective bargain premium
and the firm size-wage effect, and these effects are much smaller than previous
estimates without firm-specific controls.
JEL Classifications
J3
Fatih Fakhfakh
Universite de Paris II
Felix FitzRoy
University of St Andrews
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