This paper provides evidence on the positive impact of rank-and-file employees' relative wages on corporate innovation in terms of patent quantity and quality. This impact is reinforced in firms with a large proportion of skilled employees and a high R&D intensity, thereby confirming the...

This paper examines incentive-wage effects for production and for managerial/technical workers in both urban and rural Chinese nonagricultural enterprises. We report strong evidence of productivity-enhancing wage behavior among enterprises in all ownership categories. There is also evidence that...