RT Journal Article
SR Electronic
T1 Monopsony in Movers: The Elasticity of Labor Supply to Firm Wage Policies
JF Journal of Human Resources
JO J Hum Resour
FD University of Wisconsin Press
SP 0319-10111R1
DO 10.3368/jhr.monopsony.0319-10111R1
A1 Ihsaan Bassier
A1 Arindrajit Dube
A1 Suresh Naidu
YR 2021
UL http://jhr.uwpress.org/content/early/2021/04/05/jhr.monopsony.0319-10111R1.abstract
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.