KDI JEP Sharing Economic Rents with Workers? Evidence from Matched Employer-Employee Data in Vietnam August 31, 2025
August 31, 2025
Utilising matched employer-employee data from Vietnamese small and medium enterprises (SMEs) surveys spanning the time frame of 2007-2015, we investigate the extent to which firms share economic rents with their employees through wage adjustments. Our analysis reveals rent-sharing elasticity of 0.08-0.1, demonstrating that small firms with limited market power engage in rent sharing in response to increased economic rents, measured as value added per employee. This rent sharing is prominent if a worker is related to an owner and is engaged in non-production jobs. However, the analysis based on worker panel data indicates caution against interpreting the results as causal evidence.
- Contents
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I. Introduction
II. Empirical Strategy
III. SME data
IV. Results
V. Conclusion
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