Topic:  Wage Comparisons in and out of the Firm. 
            Evidence from a Matched Employer-Employee French Database.
Lecturer:  Prof. Claudia Senik
Host:  Prof. Li Shi
Time:  January 11^st 2016  16:30
Location:  Library Building 1620

Introduction of lecturer:

Claudia Senik is Professor of Economics at the Paris School of Economics and the University Paris-Sorbonne. She is also member of the IZA and of the InstitutUniversitaire de France. Educated at the EcoleNormaleSupérieure, she received her PhD from EHESS. Her main research areas include happiness studies, political attitudes and post-transition economies, with a special interest in the subjective welfare effects of income growth and income distribution.

Lecturer Introduction:

This paper looks at the association between wage satisfaction and other-people’s pay, based on a matched employer-employee dataset. Three notions of reference wage appear to be being of particular importance: (i) the median wage level in one’s firm, (ii) the level of wage of similar workers in the region, and (iii) the top 1% wage in one’s firm. The first one triggers a signal effect, whereby all employees - especially young ones - whatever their relative position in the firm, are happier the higher the median wage in their firm, holding their own wage constant. The second and the third ones are sources of relative deprivation, i.e. workers’ satisfaction decreases with the gap between their own salary and these reference categories. These findings are based on objective measures of earnings as well as subjective declarations about wage satisfaction, awareness of other people’s pay and reported income comparisons.