Wage Premia for Newly Hired Employees: Theory and Evidence

  title={Wage Premia for Newly Hired Employees: Theory and Evidence},
  author={Patrick Kampk{\"o}tter and Dirk Sliwka},
Wage Premia for Newly Hired Employees: Theory and Evidence We investigate wage differences between newly hired and incumbent employees. We show in a formal model that when employees care for wages as well as match-specific utility, incumbents earn less than new recruits if and only if firm-specific human capital is not too important. The existence and structure of these wage premia is then investigated empirically using detailed personnel data from a large number of banks. We find that, on… CONTINUE READING

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