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Abstract
A labour market in which wages depend on employer size means the characteristics of the same job differ between firms. In the hotel industry, the data indicate significant differences in the nature of the job according to the size of the establishment. This topic has been analysed for many economic sectors but, as far as we know, not for the hotel industry. The first aim of this paper was to establish whether there was a similar positive relationship between employer size and wages in the hotel industry. The second aim was to account for wage premia earned by workers employed by larger hotels taking into account the specific characteristics of each establishment. To achieve these aims, four hypotheses on productivity, labour quality, working conditions and internal labour markets were tested. Based on adding the productivity measure, the results show that this variable accounts for 17.8% of the establishment-size wage premium. Similar results were obtained when adding our own measures of working conditions. However, the size–wage relationship remains almost unaffected when controlling for labour quality and internal labour market variables.