Micro Foundations for Wage Flexibility : Wage Insurance at the Firm Level ∗

@inproceedings{Cardoso2009MicroFF,
  title={Micro Foundations for Wage Flexibility : Wage Insurance at the Firm Level ∗},
  author={Ana Rute Cardoso},
  year={2009}
}
To what extent do firms insulate their workers’ wages from fluctuations in product markets? Which firm and worker attributes are associated with wage flexibility at the micro level? We first rely on Guiso, Pistaferri and Schivardi (2005) to estimate dynamic models of sales and wages, finding that in Portugal, workers’ wages respond to permanent shocks on firm performance, as opposed to transitory shocks. We then explore the factors associated with wage flexibility, finding that collective… CONTINUE READING