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Ori Zax
''Promotion Policy and Firm Size''
( 2012, Vol. 32 No.4 )
In contrast to the predictions of conventional economic theory, it is well documented that similar workers receive wages positively correlated with the size of the firm employing them. To explain these findings we augment the Waldman (1984) framework by adding a size variable and construct a dynamic model of promotion and obtain an equilibrium with a positive correlation between firm size and wages.
Keywords: Firm size and wages, promotion decisions
JEL: J3 - Wages, Compensation, and Labor Costs: General
J5 - Labor-Management Relations, Trade Unions, and Collective Bargaining: General
Manuscript Received : Nov 03 2012 Manuscript Accepted : Dec 08 2012

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