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Employer Concentration and Wages for Specialized Workers

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  • Anna Thoresson

Abstract

This paper studies how wages respond to a sudden change in employer concentration by using the deregulation of the Swedish pharmacy industry. The reform involved a substantial and policy-driven increase in the number of employers that varied by local labor market. Exploiting this variation, elasticities of wages with respect to labor market concentration are estimated between −0.025 and −0.061. The positive wage effects from reduced employer concentration are most prevalent for more mobile workers as well as younger and foreign-born workers. Overall, the paper finds that employer concentration matters for wages in a context where skills are industry specific.

Suggested Citation

  • Anna Thoresson, 2024. "Employer Concentration and Wages for Specialized Workers," American Economic Journal: Applied Economics, American Economic Association, vol. 16(1), pages 447-479, January.
    • Handle: RePEc:aea:aejapp:v:16:y:2024:i:1:p:447-79
    DOI: 10.1257/app.20210280
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    References listed on IDEAS

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    1. Ben Jann, 2018. "Color palettes for Stata graphics," Stata Journal, StataCorp LP, vol. 18(4), pages 765-785, December.
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    Cited by:

    1. Brian Callaci & Matthew Gibson & Sérgio Pinto & Marshall Steinbaum & Matt Walsh, 2024. "Grads on the Go: The Effect of Franchise No-Poaching Restrictions On Worker Earnings," Upjohn Working Papers 24-405, W.E. Upjohn Institute for Employment Research.
    2. Petach, Luke, 2024. "Monopsony in the market for religion," Journal of Economic Behavior & Organization, Elsevier, vol. 221(C), pages 423-435.
    3. Lehner, Lukas & Parolin, Zachary & Pignatti, Clemente & Schmitt, Rafael Pintro, 2024. "Monopsony Power and Poverty: The Consequences of Walmart Supercenter Openings," IZA Discussion Papers 17323, Institute of Labor Economics (IZA).
    4. Popp, Martin, 2024. "Minimum Wages in Concentrated Labor Markets," IZA Discussion Papers 17357, Institute of Labor Economics (IZA).

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    More about this item

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy

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