It ain’t where you’re from, it’s where you’re at: Hiring origins, firm heterogeneity, and wages

Sequential auction models of labor market competition predict that the wages required to successfully poach a worker from rival employer will depend on productivities both poached and poaching firms. We develop theoretically grounded extension two-way fixed effects model Abowd et al. (1999) in which log hiring are comprised effect, effect for “destination” firm worker, “origin” firm, or state, was hired. This specification is shown nest reduced form delivered by semi-parametric formulations canonical sequential Postel-Vinay Robin (2002b) its generalization Bagger (2014). Fitting Italian social security records, origin found explain only 0.7% variance among job movers, while destination more than 23% variance. Across firms, 13 times as variable effects. Interpreted through lens (2014)’s model, this finding requires workers possess implausibly strong bargaining strength. Studying cohort entering 2005, we find differences yield essentially no contribution evolution gender gap wages, majority at time entry. These results suggest where hired tends be relatively inconsequential their comparison they currently employed.