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Title: The More You Know, the Better You're Paid? Evidence from Pay Secrecy Bans for Managers

Citation Type: Miscellaneous

Publication Year: 2019

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Abstract: Approximately half of Americans work at a firm where they are forbidden or discouraged from discussing their pay with coworkers. Employees who violate these rules may be subject to punishment or dismissal. While many employees are legally protected from reprisal under the National Labor Rights Act, the law does not cover managers. Eleven states have passed laws banning pay secrecy policies for managers. In this paper, we explore what effect these state laws had on wages and inequality. We find that pay secrecy bans increased the wages of managers by 3.2%. There is suggestive evidence these policies increased wage inequality in the labor market. The wage gains of managers went solely to men earning above the median income. This increased the wage gap for female managers earning above the median income by 7%.

Url: https://kyle-kettler.com/wp-content/uploads/sites/15/2019/01/PaySecrecy_v2-3.pdf

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Authors: Burn, Ian; Kettler, Kyle

Publisher: Stockholm University

Data Collections: IPUMS USA

Topics: Labor Force and Occupational Structure, Other

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