Files

Abstract

This dissertation consists of two parts. The first part concerns how and to what extent the worker-firm rent-sharing mechanism confounds the estimates of the return to tenure. This study finds that the worker-firm rent-sharing responses empirically create a large downward bias in the return to job tenures in the context of the Norwegian labor market. I conduct detailed analyses on potential sources of biases. I argue that workers' job mobility not only depends on the differences in the origin and destination firms' time-invariant pay premiums but also on the realizations of their firm-specific wage innovations. I show that the between-firm differences in the firm-specific wage innovations play a dominating role in driving the large downward bias in the previous return-to-tenure estimates. The estimated firm-specific time-varying pay premiums are positively correlated with but not sufficiently explained by firm-level productivity measures such as value-added or firm sizes. Instead, I find that alternative measures, such as employment shares of newly hired workers, which capture the booms and busts and the compositional changes in employment at the firm level, are good proxies to help reduce biases. In the second part, we quantify how labor supply elasticities and reservation wages vary between people and over time, and infer workers' valuation of flexibility in their choices of work hours. Economists and policymakers are keenly interested in these quantities, especially lately with the growth in jobs that offer flexible work schedules. Our study takes advantage of a large natural field experiment at Uber, the largest ride-sharing company. Combining this experiment with high frequency panel data on wages and individual work decisions, we estimate a dynamic labor supply model that let us recover reservation wages, labor supply elasticities, and workers valuation of flexibility.

Details

Actions

PDF

from
to
Export
Download Full History