The rule that bigger workplaces pay more doesn't apply inside large companies

Economists thought bigger workplaces always paid higher wages. But new research in Germany finds this is not true for different locations of the same large company.

For decades, economists assumed that larger workplaces always paid higher wages. This paper shows that within a single large company, the size of a specific office or factory does not affect how much workers get paid. It means large companies might not be paying the absolute minimum to attract labor; they might be paying more than they have to, even when they could pay less.