Research

Dr Kerstin Holzheu, Science Po

"Wage Bargaining and Wage Posting Firms"
Thursday, 7 May 2026. 15:00
Room 386AB ASBS

Abstract

This paper studies the coexistence of two wage-setting regimes: wage posting and offer matching/wage bargaining. Based on a job-ladder model with both firm types, we develop a novel theoretically-informed maximum-likelihood clustering and estimation procedure that treats firms' wage-setting regimes as latent. Using German employer survey data to benchmark the classification and Austrian matched employer--employee records for estimation, we obtain consistent evidence across settings. Bargaining firms account for about 28% of firms in Austria and 24% in Germany; they are more productive and exhibit greater within-firm wage dispersion. The model explains job-to-job wage declines as workers transition from posting to bargaining firms, leading to inefficient mobility and output losses ranging from 13% to 36% of total output changes driven by job-to-job mobility. Counterfactuals show that segmenting labor markets by wage-setting regime raises wages relative to the mixed economy.

Bio

Kerstin Holzheu is an Assistant Professor of Economics at Sciences Po (Paris). She was previously a Visiting Fellow/Visiting Professor at Yale University (2023-2024). She earned her PhD in Economics from the University of Chicago and previously held a postdoctoral position at the Institute for Fiscal Studies. Her research lies at the intersection of labor and macroeconomics, focusing on wage dynamics, firm and worker heterogeneity, specialization, and the diffusion of knowledge across firms, with work published in outlets including the Journal of Labor Economics and Labour Economics. She is a Fellow of IZA and CESifo.

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First published: 21 April 2026