Profit-Sharing and Wages: An Empirical Analysis Using French Data Between 2000 and 2007

Noélie Delahaie and Richard Duhautois

Abstract: Economic theory presents two main views on the effect of profit-sharing on wages. First, profitsharing may substitute for base wages and have a neutral effect on total compensation. Second, it may be interpreted as an "efficiency wage" that increases total compensation. Existing empirical literature does not allow a determination of which of these two arguments is valid. This paper attempts to tackle this issue in the case of France for the 2000-2007 period. Based on a differencein-differences selection model, our results suggest that profit-sharing has a neutral effect on total compensation. Several years after its implementation within firms, profit-sharing lowers base wages, which are offset by profit-sharing bonuses.

Keywords: profit-sharing; wages (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-eff and nep-hme
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01143491v1
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Related works:
Journal Article: Profit‐Sharing and Wages: An Empirical Analysis Using French Data between 2000 and 2007 (2019)
Working Paper: Profit-Sharing and Wages: An Empirical Analysis Using French Data between 2000 and 2007 (2019)
Working Paper: Profit-Sharing and Wages: An Empirical Analysis Using French Data Between 2000 and 2007 (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:halshs-01143491

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