Title: Wage Mobility and Dynamics in Italy in the 1990s
Abstract: Abstract This chapter, which describes the structure of wages within and between Italian firms in the 1990s, shows that firms do not follow a pay compression model in their wage policy. Firm wage policy matters in shaping the wage level distribution and also the wage change distribution. Low-wage firms almost always exhibit the highest positive net flows, which is consistent with what is observed in other countries. The link between firm size and within-firm individual seniority is positive, and exit rates decline as wages increase. In Italy, almost all large firms directly bargain over wages with unions, holding the nationwide industry contract as a benchmark. Negative wage growth is more common among movers and short-tenure workers. In addition, worker entry and exit rates are higher at low-pay firms and lower at high-pay firms.