PT  - JOURNAL ARTICLE
AU  - Ihsaan Bassier
AU  - Arindrajit Dube
AU  - Suresh Naidu
TI  - Monopsony in Movers: The Elasticity of Labor Supply to Firm Wage Policies
AID  - 10.3368/jhr.monopsony.0319-10111R1
DP  - 2021 Apr 13
TA  - Journal of Human Resources
PG  - 0319-10111R1
4099  - http://jhr.uwpress.org/content/early/2021/04/05/jhr.monopsony.0319-10111R1.short
4100  - http://jhr.uwpress.org/content/early/2021/04/05/jhr.monopsony.0319-10111R1.full
AB  - We estimate the impact of the firm component of hourly wage variation on separations from matched Oregon employer-employee data. We use both firm fixed effects estimated from a wage equation as well as a matched IV event study around employment transitions between firms. Separations decline with firm wage policies: the implied firm-level labor supply elasticities are around 4, consistent with recent quasi-experimental evidence, but 3 to 4 times larger than existing estimates using individual wages. We find that monopsonistic competition is pervasive, even in low-wage, high turnover sectors, but with little heterogeneity by labor market concentration.