Ming Xu, Queen’s University

Fri. Jan. 30 02:30 PM - Fri. Jan. 30 04:00 PM
Location: 3BC55

"Dynamic Wage Setting: The Role of Monopsony Power and Adjustment Costs"

Abstract: In this paper we develop and estimate a general framework for identifying wage markdowns, firm/worker productivity and adjustment costs. We show novel facts: markdowns are widening in ability, firm size, and firm productivity. Constrained firms pay workers above their MRPL and have lower passthrough elasticities. We find that labor supply elasticities pin down the level of markdowns, but the variance is driven entirely by firm-level employment costs.