This has been the subject of a number of recent empirical studies, which have tended to find productivity to have been a significant factor. 55  A useful starting point is the distribution of wages across our panel of firms (Chart 26). There is some evidence of a widening dispersion in wages across companies over time. The pattern broadly mirrors productivity, with wages among the top 1% of companies rising, except immediately after the financial crisis. At the same time, pay has largely stagnated among as many as three-quarters of the firms in the distribution. By itself, this does not tell us how closely firm-level pay and productivity have been correlated and what contribution productivity may have played in widening the dispersion of wages. 56  While there is an  established literature on the aggregate relationship between productivity and wages, the relationship between firms’ productivity and average pay levels is less certain. Nevertheless, looking at the distributions of pay and productivity, three points stand out (Chart 27). First, labour productivity can explain around 60% of the variation in average pay across firms, controlling for other firm characteristics. On average, firms with 1% higher productivity have 0.2% higher pay. And firms with 1 percentage point faster productivity growth have 0.5 percentage points faster wage growth (Table 4). Productivity dispersion across companies is an important, if by no means the only, driver of wage dispersion across households. Second, the distribution of pay is materially narrower than for productivity.
Rodrigo Vergara: The Monetary Policy Report and the Financial Stability Report Presentation by Mr Rodrigo Vergara, Governor of the Central Bank of Chile, before the Finance Commission of the Honorable Senate of the Republic, Santiago de Chile, 18 December 2012. The Monetary Policy Report of December 2012 and the Financial Stability Report of the second half of 2012 can be found at http://www.bcentral.cl. *  *  *  Introduction Mr. President of the Senate’s Finance Commission, Senator Jose García, senators members of this Commission, ladies and gentlemen, I appreciate your invitation to present our Board’s vision on recent macroeconomic and financial developments, their prospects and implications for monetary and financial policy. This vision is contained in detail in our Monetary Policy Report of December 2012 and our Financial Stability Report of the second half of 2012. The year that is ending has brought good news to our economy. The inflationary fears we expressed early in the year have abated. This year our economy will grow 5.5 percent. Unemployment is low, labor income is growing steadily and consumer and business expectations are optimistic. Investment is high by historic standards. A year ago, when we presented our reports to this Commission, we foresaw that the deepening of the Eurozone crisis at the time could have significant effects on our economy, including a major slowdown during 2012. It did not.