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Dissertation Information for Trevor Roycroft

NAME:
- Trevor Roycroft
- (Alias) G. Trevor Ross Roycroft

DEGREE:
- Ph.D.

DISCIPLINE:
- Economics

SCHOOL:
- University of California, Davis (USA) (1989)

ADVISORS:
- None

COMMITTEE MEMBERS:
- None

MPACT Status: Incomplete - Not_Inspected

Title: Sorting, bonding, and barriers to entry: Strategies of the entry-concerned firm

Abstract: "This dissertation marks a significant departure from the established theoretical justification for the wage differentials which have been observed to persist across industries. The model begins with a protected monopolist who is able to distinguish between high and low productivity employees. When entry is allowed, the entrant has this capability as well. We will see that under certain conditions, the monopolist will sort for high productivity workers, and impose a lower level of profits on any potential entrant than if the sorting option had not been pursued. The necessary and sufficient conditions for the imposition of a strategic entry barrier and an innocent entry barrier are illustrated. The model is then extended to allow potential entrants to bid the sorted workers away from the monopolist. It is shown that if the protected monopolist uses a bonding strategy, such as offering workers a pension plan, the potential entrants will not be able to bid workers away at low cost. Finally, we discuss the implications of this model if firms are not able to distinguish between low and high productivity workers when all workers are offered the going wage. This last extension of the basic model shows a link between high wages and concentrated industries, loosely following the efficiency wage hypothesis.

Using the May 1983 Current Population Survey and Pension supplement, econometric tests indicate that a strong positive correlation between wages paid and industry concentrations exists. It is also confirmed that industry concentration plays a significant and positive role in determining whether or not a worker is bonded to a firm. The hypothesis that firms may offer high wages to sort for high productivity labor, and then bond these workers to the firm using some type of pension plan, cannot be rejected as a result of the empirical tests."

MPACT Scores for Trevor Roycroft

A = 0
C = 1
A+C = 1
T = 0
G = 0
W = 0
TD = 0
TA = 0
calculated 2008-01-31 06:24:09

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Students under Trevor Roycroft

ADVISEES:
- None

COMMITTEESHIPS:
- Judith Ann Molka-Danielsen - University of Pittsburgh (1996)