Descriptive Evidence on Labor Market Transitions and the Wage Structure in Germany


Fitzenberger, Bernd ; Garloff, Alfred


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URL: http://ub-madoc.bib.uni-mannheim.de/1214
URN: urn:nbn:de:bsz:180-madoc-12140
Document Type: Working paper
Year of publication: 2005
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: E24 J21 J31 J64 ,
Subject headings (SWD): Deutschland , Lohn , Arbeitsmarkt
Abstract: Equilibrium search theory suggests that the wage distribution in a cross section of workers is closely related to labor market transitions and associated wage changes. Accordingly, job–to–job transitions are central in explaining the wage distribution. This paper uses the IAB employment subsample to describe the empirics of labor market transitions and the wage structure in Germany. Motivated by search theory, we use the data to explore descriptively labor market transitions and features of the wage structure. We find that labor market transition rates vary substantially over the business cycle and with individual characteristics. Regarding job–to–job transitions, we find considerable wage changes. Most job changes involve considerable gains, but a number of individuals incurs a remarkable loss. Regarding the wage structure, we find strong effects of job–to–job transitions, age, and education on wage mobility. Based on our descriptive analysis, we conclude that indeed a close relationship exists between wages and labor market transitions as predicted by search theory. However, the noticeable share of wage losses following job–to–job changes contradicts a simple search theoretic perspective.
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Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.




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Fitzenberger, Bernd ; Garloff, Alfred (2005) Descriptive Evidence on Labor Market Transitions and the Wage Structure in Germany. Open Access [Working paper]
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