Year: 2022
Type: report
Abstract: Job differentiation gives employers market power, allowing them to pay workers less than their marginal productivity.We estimate a differentiated jobs model using application data from Careerbuilder.com.We find direct evidence of substantial job differentiation.Without the use of instruments for wages, job applications appear very inelastic with respect to wages.Plausible instruments produce elastic firm-level application supply curves.Under some assumptions, the implied market level labor supply elasticity is 0.5, while the firm level labor elasticity is 4.8.This suggests that workers may produce 21% more than their wage level, consistent with significant monopsony power.
DOI: 10.3386/w30365
Authors: José Azar, Steven Berry, Ioana Marinescu
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
Funder: Yale University
OpenAlex ID: W4300810448