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The Ddeterminants of Individual Wages in Australia: Competitive and Non‐Competitive Influences

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  • Jeff Borland
  • Anthony Suen

Abstract

This work provides a test of competitive theories of wage determination by examining the wages of identical workers across industry classifications. The finding that a set of significant industry wage differentials exists would seem to contradict a purely competitive theory of wage determination. However, the apparent presence of unmeasured human capital that is correlated with industry status does provide one potential competitive explanation for the industry wage effects. Moreover, non‐competitive explanations for the differences in industry wages, such as efficiency wage theory or institutional factors, appear to be inconsistent with the nature of the wage differentials.

Suggested Citation

  • Jeff Borland & Anthony Suen, 1990. "The Ddeterminants of Individual Wages in Australia: Competitive and Non‐Competitive Influences," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 23(4), pages 33-44, December.
    • Handle: RePEc:bla:ausecr:v:23:y:1990:i:4:p:33-44
    DOI: 10.1111/j.1467-8462.1990.tb00369.x
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    References listed on IDEAS

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    1. William T. Dickens & Lawrence F. Katz, 1987. "Inter-Industry Wage Differences and Theories of Wage Determination," NBER Working Papers 2271, National Bureau of Economic Research, Inc.
    2. William T. Dickens & Brian A. Ross, 1984. "Consistent Estimation Using Data From More Than One Sample," NBER Technical Working Papers 0033, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Elizabeth Webster & Yi‐Ping Tseng, 2002. "The Determinants of Relative Wage Change in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(1), pages 70-84, March.
    2. Kevin T. Reilly & Luisa Zanchi, 2003. "Industry wage differentials: how many, big and significant are they?," International Journal of Manpower, Emerald Group Publishing Limited, vol. 24(4), pages 367-398, June.
    3. Francis Vella, 1993. "Gender Roles, Occupational Choice and Gender Wage Differential," The Economic Record, The Economic Society of Australia, vol. 69(4), pages 382-392, December.
    4. Serena Yu & David Peetz, 2019. "Non‐Standard Time Wage Premiums and Employment Effects: Evidence from an Australian Natural Experiment," British Journal of Industrial Relations, London School of Economics, vol. 57(1), pages 33-61, March.
    5. Satya Paul & Ahmad Assadzadeh, 2001. "Empirical earnings functions for Iran," Applied Economics, Taylor & Francis Journals, vol. 33(1), pages 11-21.
    6. Zanchi, Luisa, 1998. "Interindustry wage differentials in dummy variable models," Economics Letters, Elsevier, vol. 60(3), pages 297-301, September.

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