The impact on wages of generic competencies, psychological capital, new work practices and digital technologies

This paper examines the impact of competencies, psychological capital, new work practices and digital technologies on private sector wages in the Italian economy. It demonstrates ‒ also considering industry collective bargaining that tends to fix wage levels according to job complexity, moreover giving rise to employment relations governed by incomplete contracts ‒ that firms pay extra wage premia to workers who: i) use digital technologies, provided they are versatile in the use of these new tools, ii) activate a bundle of distinctive ‘generic’ competencies, iii) possess personal traits considered by the firm as productive in carrying out work, and iv) occupy positions to which the organizational design attributes greater autonomy and more responsibilities. The wage equation used controls for several detailed factors (firm characteristics, occupations, worker characteristics, working and contract conditions, industrial relations) and was estimated with weighted OLS, also controlling for heteroskedasticity. Endogeneity was tested with GMM estimators.