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Size and evolution of the financial wage premium. Unpublished translation of “Ampleur et évolution dela prime salariale financière”, Regards croisés sur l'économie, 2020, 27(2): 97-109

Author

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  • Olivier Godechot

    (Sciences Po - Sciences Po)

  • Paula Apascaritei
  • István Boza
  • Martin Hallsten
  • Lasse Henriksen
  • Are Hermansen
  • Feng Hou
  • Jiwook Jung
  • Alena Křížková
  • Zoltán Lippényi
  • Elvira Marta
  • Silvia Maja Melzer
  • Eunmi Mun
  • Halil Sabanci
  • Naomi Kodama
  • Max Thaning

Abstract

We measure the size and evolution of the wage premium for a job in finance. In thirteen developed countries, wages, especially high wages, increased at a sustained pace in this sector during the 1990s and 2000s, contributing strongly to the increase in the share of the national top 1% and hence to inequality. The explanation of this gap by differences in talent is not enough. In France, salaries remain 25 to 30% higher once the effect of the diploma is deducted. We offer an alternative explanation based on the ability of employees to move financial activity with them from one firm to another.

Suggested Citation

  • Olivier Godechot & Paula Apascaritei & István Boza & Martin Hallsten & Lasse Henriksen & Are Hermansen & Feng Hou & Jiwook Jung & Alena Křížková & Zoltán Lippényi & Elvira Marta & Silvia Maja Melzer &, 2021. "Size and evolution of the financial wage premium. Unpublished translation of “Ampleur et évolution dela prime salariale financière”, Regards croisés sur l'économie, 2020, 27(2): 97-109," SciencePo Working papers Main hal-03363171, HAL.
    • Handle: RePEc:hal:spmain:hal-03363171
    Note: View the original document on HAL open archive server: https://hal.science/hal-03363171
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    References listed on IDEAS

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    1. Brian Bell & John Reenen, 2014. "Bankers and Their Bonuses," Economic Journal, Royal Economic Society, vol. 124(574), pages 1-21, February.
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