This paper identifies a causal link between changes in product market competition, firm reorganization and within-firm wage inequality. We exploit a unique episode of comprehensive firm entry deregulation as a quasi-natural experiment and use exceptionally detailed linked employer-employee data for the universe of private sector firms and workers in Portugal. Following deregulation affected firms flatten their hierarchies: the number of layers is reduced and managers’ span of control increased. Dropping a hierarchy layer is accompanied by a significant reduction in wage inequality within the firm, by 8% for the average pay ratio between the top and the bottom layer and 4.4% for the 90-50 percentile wage ratio, showing that there are real changes arising from firm reorganization. Overall wage dispersion, measured by the standard deviation of hourly pay, is also reduced. We discuss mechanisms and interpretations for these changes.

本文确定了产品市场竞争变化、企业重组和企业内部工资不平等之间的因果关系。我们利用公司进入放松管制的独特事件作为准自然实验，并使用非常详细的雇主-雇员相关数据来了解葡萄牙的私营部门公司和工人。在放松管制之后，受影响的公司扁平化了他们的层级：层数减少了，管理人员的控制范围增加了。降低层级伴随着公司内部工资不平等的显着减少，顶层和底层之间的平均工资比率下降了 8%，而 90-50 个百分点的工资比率下降了 4.4%，表明存在真正的变化因公司重组而产生。总体工资分散，以小时工资的标准差衡量，也减少了。我们讨论这些变化的机制和解释。