The Impact of Wage Gap inside enterprises on Product Quality-质量院英文网
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The Impact of Wage Gap inside enterprises on Product Quality

April 7, 2016

Cheng Hong, Zhang Cheng
(Institute of Quality Development Strategy,Wuhan University,
Coordination Innovation Center of Macro Quality Management in Hubei Province)


Abstract: In this paper, a representative of Chinese companies - matching employee survey data, applications, tournament theory empirical research model validation affect internal wage gap between the quality of products by empirical data, so as to provide reference for enterprises to set reasonable wage gap basis, and enhance product quality. Most previous research conclusion is discrepant. We find that the wage gap between enterprises and product quality is inverted "U" shaped relationship: the quality of their products with the expansion of the wage gap, showing a downward trend after the first rise. Further enterprise wage packet if collective bargaining do empirical regression showed a wage gap to affect the internal quality of their products is a causal effect. Therefore, enterprises should maintain employee wage gap within reasonable limits to further enhance product quality.

Keywords: Wage gap,Product quality ,Tournament theory