Firm Size and Labour Market Segmentation Theory: Evidence from Turkish Micro Data

Wage formation in the labor market is analyzed with different perspectives and methods by Orthodox and Heterodox economists. Especially one of the main theories of how wages determined on the firm and industry is the theory of Segmented Labour Markets (SLM) based on the Institutional Economics and New Institutional Economics. Labor market segmentation theory suggests that jobs and labor are divided into labor market segments. While jobs are divided into “good jobs” and “bad jobs”, labor market is stratified according to job and wage. In this study, by drawing on micro-data from Turkish Statistical Institute (TurkStat) Househould Labour Force Survey (HLS), we aim to analyze the theory of SLM in Turkey on the basis of firm size for the year of 2011. In this context, Binary Logistic Regression Analysis was used. According to the analyses results, findings indicate that according to the firm size Turkish labour market shows a stratified structure in terms of gender, age, education, marital status, main activity of workplace (sector), status of workplace and occupations (International Standard Classification of Occupations-ISCO-88).