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Employee Control, Work Content and Wages

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  • André Cieplinski

Abstract

Recent contributions have highlighted a technological bias in the substitution of routine work as a cause of wage inequality. Technological progress is assumed to increase returns to abstract, cognitive work and reduce those related to physical, usually routine, work activities. This article puts forward an alternative interpretation whereby wages are related to employees' control over work, which is conditioned by the institutions that represent workers' interests. We use O*NET detailed occupational level data to build two measures of control over i.) physical or tangible work activities, ii.) abstract or non-tangible work activities and one of the direct impact over firm's profits and production. These are used to contest previous interpretations of this data as a measure of task intensity and the relevance of a disaggregation between routine and non-routine work, at least for wage outcomes. We develop a simple bargaining model that suggests employee control adds to the bargaining power of workers and has a negative relation to impact, which is used to a greater extent in industries where control over work is not sufficient to increase wages, a relation that is corroborated by random slopes multilevel models estimates. A comparison of these random coefficients with industry level characteristics provides evidence that institutions such as unions and professional associations increase the odds of receiving a wage premium related to employee control, but finds very limited support for a relation between technological change and the estimated wage premia.

Suggested Citation

  • André Cieplinski, 2017. "Employee Control, Work Content and Wages," Department of Economics University of Siena 775, Department of Economics, University of Siena.
    • Handle: RePEc:usi:wpaper:775
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    More about this item

    Keywords

    Labour Economics; Industrial Relations; Job Polarization; Wage Polarization;
    All these keywords.

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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