Any opinions expressed here are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but the institute itself takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. IZA Discussion Paper No. 7289

The question of wage differentials by firm size has been studied for several decades with no commonly accepted explanations for why large firms pay more. In this paper, we reexamine the relationship between firm-size and wage outcomes by estimating the returns to unmea-sured ability between large and small firms. Our empirical methodology, based on non linear instrumental variable estimations, allows us to directly estimate the returns to unmeasured ability by firm size and therefore to test the two main theories of wage determination proposed to explain the relationship between firm size and wages, namely ability sorting and job screen-ing. We use data from the Survey of Labour and Income Dynamics (SLID) which provides longitudinal information on workers and firms characteristics including establishment and firm size. We find significant differences in the returns to unmeasured ability across firm size. In particular, we find that the returns to unmeasured ability seem to follow a non linear pattern. The returns to unmeasured ability are significantly higher in medium size (above 500 but below 1000 workers) firms relative to small firms. However, the returns to unmeasured ability are not significantly greater in large firms relative to medium or small firms. Overall, it seems that ability sorting dominates for moves from small to medium size firms in that ability is more productive and therefore more rewarded in the latter than the former. On the other hand, when firms become “too large”, the monitoring costs hypothesis seems to dominate in that ability is not more rewarded than in smaller firms.

The Phoenician settlements of Cerro del Villar (south of Spain) and Mozia (Sicily) constitute two appropriate settings to analyze the processes of formation of new identities in the western Phoenician colonial areas. The material culture of these settlements, founded during the 8th century B.C.E., express the coexistence of Phoenicians with various western Mediterranean populations. The present study analyzes how the inhabitants of these colonies consciously used their material culture to construct new identities. Architecture, technological innovation, ritual and tableware for the service of food and drinks show a formal homogeneity that expresses links with the metropolis and with other Phoenician Mediterranean settlements. All these elements are highly visible and public, which contrasts with the presence of material elements of local cultures or hybrids in the domestic sphere, or in workshops associated with handcrafted processes already known by the local groups. Architecture, technology, ritual and tableware were all used actively in the construction of new identities in these settlements. These new identities go beyond ethnicity and are the expression of social and political negotiations within colonial spaces.