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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 Unpublished translation of “Ampleur et évolution dela prime salariale financière”, Regards croisés sur l'économie, 2020, 27(2): 97-109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

Listed:
  • 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 Unpublished translation of “Ampleur et évolution dela prime salariale financière”, Regards croisés sur l'économie, 2020, 27(2): 97-109," Working Papers hal-03363171, HAL.
    • Handle: RePEc:hal:wpaper: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. Thomas Philippon & Ariell Reshef, 2012. "Wages and Human Capital in the U.S. Finance Industry: 1909--2006," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(4), pages 1551-1609.
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    4. Godechot, Olivier, 2015. "Financialization is marketization! A study on the respective impact of various dimensions of financialization on the increase in global inequality," MaxPo Discussion Paper Series 15/3, Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo).
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