Wages, productivity, and worker characteristics: Evidence from plant-levelproduction functions and wage equations

We use a unique new data set that combines data on individual workers and t heir employers to estimate marginal productivity differentials among differ ent types of workers. We then compare these to estimated relative wages, le ading to new evidence on productivity-based and nonproductivity-based expla nations of the determination of wages. Among our findings are (1) the highe r pay of prime-aged workers (aged 35-54) and older workers (aged 55+) is re flected in higher point estimates of their relative marginal products, and (2) for the most part, the lower relative earnings of women are not reflect ed in lower relative marginal products.