We empirically model individual utility from pay as function of worker’s own wage and the earnings of all other workers within the same establishment. The aims of this paper are twofold: first, to study the mechanisms underlying the importance of relative wages in determining worker...

This paper attempts to combine the analysis of wage (income) polarization with that of wage (income) mobility. Using the polarization index PG recently proposed by Deutsch et al. (2007) it shows that, when taking the identity of the individuals into account (working with panel data), a...