This seminar will take place on October 16 at 15:30. The seminar will be in a hybrid format with:
- in-person session in the IST Alameda Campus, Department of Engineering and Management's Meeting Room
- online, via Zoom https://zoom.us/j/94872868488?pwd=T6xujALS36RjvtzOy5bvv9pH4yxNN8.1
Our seminars are free to attend and open to everyone. Please share with whomever may be interested.
Summary
Do wages in other firms shape employment outcomes? This paper adopts a peer effects framework combined with machine learning methods to identify workers’ relevant labor markets and estimate the influence of their quality and structure on wages. High-wage workers tend to work in better-paying markets, but their outside options are worse relative to their current firm. Furthermore, I find that a 10% increase in the quality of other firms in the market is associated with an increase in real wages by 3%, on average. However, controlling for common market shocks flips this sign, showing evidence of a strong wage markdown consistent with backloaded pay structures. This effect is stronger for new hires and less skilled workers. Finally, I show that the structure and quality of labor markets matter for inequality: about 15% of the wage variance in Portugal can be explained by differences in market-specific pay premia.
Speaker's bio
Rodrigo Barrela is a PhD candidate in Economics at Nova School of Business and Economics. His research focuses on labor economics and panel data econometrics, especially wage determination, inequality, and labor-market structures. He has previously worked at the European Central Bank and the International Monetary Fund.
Personal homepage: https://rodrigobarrela.github.io/