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on Business Economics |
| By: | Ia Vardishvili |
| Abstract: | I show that firms' ability to delay entry generates a countercyclical opportunity cost of entry and significantly amplifies the effect of the initial aggregate conditions on the selection of entrants. This mechanism enables existing firm dynamics models to reconcile the documented business cycle dynamics of US entrant establishments without leading to an excessive variation in economic aggregates. I find the observed variation of firms at entry is responsible for around three-fourths of the business cycle fluctuations. Finally, I argue that not accounting for the option to delay entry may result in misleading predictions about entrants' responses to different shocks or policies. |
| Keywords: | Option value, entry, firm dynamics, business cycles, propagation, Great Recession |
| JEL: | E22 E23 E32 E37 L25 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:abn:wpaper:auwp2020-07&r=all |
| By: | Bias, Daniel; Chen, Lin; Lochner, Benjamin; Schmid, Thomas |
| Abstract: | We propose a novel measure for workers' financial incentives based on withinestablishment wage differences among similar workers from the same occupation. This measure captures all forms of incentive pay that lead to workeremployer-specific pay premiums, including explicit (e.g., bonuses) and implicit forms (e.g., tournaments). We estimate the measure using a linked workerestablishment-firm dataset that covers 31 million workers in Germany. For validation, we exploit survey-based information on performance pay and variation in monitoring costs due to occupational characteristics, establishment size, and task complexity and show that the measure behaves as theoretically predicted. Applying the measure yields evidence that workers' incentives positively correlate with firms' performance and innovativeness, which supports a positive relationship between incentives and effort. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:072020&r=all |
| By: | Silvia Lui; Russell Black; Josefa Lavandero-Mason; Mohammad Shafat |
| Abstract: | We use a novel firm-level dataset to measure employment dynamics of UK businesses from 1999 to 2019, building on microdata from the Inter-Departmental Business Register (IDBR) and administrative data on employment from PAYE records at HMRC. We construct a new quarterly dataset by using consecutive snapshots of the IDBR to deduce signs of activity of firms. We present detailed descriptive analysis showing the quarterly averages for job creation and destruction by size, sector, transition status and age. In addition, we compute the marginal effects of age and size on growth using the Davis, Halitwanger and Schuh (DHS) approach. Our results show that business dynamism has slowed down since the 2008-2009 financial crisis on two levels: firstly, a decline in job destruction and secondly, a decline in job creation due to entry. Age has an important role in UK’s business dynamism – young firms are the most dynamic group of enterprises, independently of size. |
| Keywords: | business dynamism, employment, administrative data |
| JEL: | C81 D22 L25 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:nsr:escoed:escoe-dp-2020-14&r=all |
| By: | Flavio Calvino (OECD); Chiara Criscuolo (OECD); Rudy Verlhac (OECD) |
| Abstract: | This paper analyses trends in business dynamism across 18 countries and 22 industries over the last two decades, using highly representative comparable data. It finds that declines in business dynamism, pervasive in many countries, are driven by dynamics occurring at a disaggregated sectoral level, rather than reallocation across sectors. Average trends within sectors point to steady declines in each country over the last two decades, even after accounting for the role of the business cycle, with market structure and firm heterogeneity emerging as prominent determinants. Investments in intangibles and digital technologies, globalisation, and changes in demographics also contribute to these trends. Policy can, however, help boost business dynamism by reducing barriers to entry and to knowledge diffusion, favouring experimentation and creative destruction, and increasing absorptive capacity and firms’ potential to benefit from technological change. |
| Keywords: | Business dynamism, Employment dynamics, Firm demography, Job reallocation |
| Date: | 2020–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:oec:stiaac:94-en&r=all |
| By: | Santiago Caicedo; Miguel Espinosa; Arthur Seibold |
| Abstract: | We study firm responses to a large-scale change in apprenticeship regulation in Colombia. The reform requires firms to train, setting apprentice quotas that vary discontinuously in firm size. We document strong heterogeneity in responses across sectors, where firms in sectors with high skill requirements tend to avoid training apprentices, while firms in low-skill sectors seek apprentices. Guided by these reduced-form findings, we structurally estimate firms’ training costs. Especially in high-skill sectors, many firms face large training costs, limiting their willingness to train apprentices. Yet, we find substantial overall benefits of expanding apprenticeship training, in particular when the supply of trained workers increases in general equilibrium. Finally, we show that counterfactual policies that take into account heterogeneity across sectors can deliver similar benefits from training while inducing less distortions in the firm size distribution and in the allocation of resources across sectors. |
| Keywords: | Apprenticeships, vocational training, firms |
| JEL: | E24 J21 J24 M5 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2020_233&r=all |
| By: | Min Jae Kim; Jonathan Witmer |
| Abstract: | Unexpected changes in interest rates lead small firms to materially change their investment rate. Large firms, in contrast, show a smaller response. This suggests both that financial conditions are an important channel for transmitting monetary policy and that firm characteristics can help us better understand fluctuations in business investment. |
| Keywords: | Firm dynamics, Monetary policy, Monetary policy: transmission of |
| JEL: | D92 G32 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocsan:20-26&r=all |
| By: | Andrea Colciago; Stefano Fasani; Rossienza Rossi |
| Abstract: | We formulate and estimate a business cycle model which can account for key business cycle properties of labor market variables and other aggregates. Three features distinguish our model from the standard model with Search And Matching (SAM) frictions in the labor market: frictional firm entry, endogenous product variety, and investment in two assets: stocks and physical capital. Our model with firm dynamics displays an endogenous form of wage moderation. Thanks to the latter, it outperforms the SAM framework augmented with exogenous real wage rigidities. |
| Keywords: | Entry; Unemployment; Bayesian Analysis; Search and Matching |
| JEL: | C5 E32 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:695&r=all |
| By: | INUI Tomohiko; Young Gak KIM |
| Abstract: | Using the most comprehensive Japanese firm-level dataset, we investigate the effect of exchange rate fluctuations on Japanese firms' performance in the international market. We examine firm characteristics based on firm export dynamics. The estimation results overall indicate the depreciation of the yen may play an important role in the expansion of export, but a limited role in terms of entry to the export market. The results also show that export elasticity is significantly affected by import intensity, and decreases from 0.81 in 1997 to 0.64 in 2015 because of the increased import intensity, indicating that fully globalized firms utilize imports to alleviate negative shocks from exchange rates on exports and to improve price competitiveness. |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:20083&r=all |
| By: | Olivier De Jonghe (National Bank of Belgium & Tilburg University); Klaas Mulier (Ghent University); Glenn Schepens (European Central Bank) |
| Abstract: | This paper shows that, when the price of emission allowances is sufficiently high, emission trading schemes improve the emission efficiency of highly polluting firms. The efficiency gain comes from a relative decrease in emissions rather than a relative increase in operating revenue. Part of the improvement is realized via the acquisition of green firms. The size of the improvement depends on the initial allocation of free emission allowances: highly polluting firms receiving more emission allowances for free, such as firms on the carbon leakage list, have a weaker incentive to become more efficient. For identification, we exploit the tightening in EU ETS regulation in 2017, which led to a steep price increase of emission allowances and made the ETS regulation more binding for polluting firms. |
| Keywords: | climate change; climate regulation;emission trading; firm behaviour |
| JEL: | D22 G34 G38 Q53 Q54 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbb:reswpp:202010-390&r=all |
| By: | Laszlo Goerke (Institute for Labour Law and Industrial Relations in the European Union (IAAEU), Trier University) |
| Abstract: | Trade unions distort a profit-maximising firm's input choice. The nature of the resulting inefficiency depends on whether there are wage negotiations or there is efficient bargaining. Moreover, trade unions redistribute income and thereby affect welfare. If firms also pursue Corporate Social Responsibility (CSR) objectives, input choices may be distorted already in the absence of collective bargaining. Adopting a positive perspective, we show that CSR objectives, which induce a firm to expand production, have ambiguous wage and employment consequences in case of wage negotiations and raise employment if there is efficient bargaining. Importantly from a normative vantage point, such CSR objectives make a welfare-enhancing role of trade unions more likely in the presence of wage negotiations. The reverse is true in case of efficient bargaining. |
| Keywords: | Corporate Social Responsibility, Efficient Bargaining, Trade Unions, Wage Bargaining, Welfare |
| JEL: | D60 J51 L31 M14 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:iaa:dpaper:202006&r=all |
| By: | Pradhana, Made Bagoes |
| Abstract: | Firm Performance (kinerja Perusahaan |
| Date: | 2020–10–03 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:9phfw&r=all |
| By: | Winatha, Arvin |
| Abstract: | Kinerja dapat diukur melalui beberapa cara dan pendekatan. Kinerja perusahaan dapat diukur dengan Tobin Q’s variable dari sisi keuangan atau financial dan harga saham dari perusahaan.Kinerja Perusahaan juga bisa diukur melalui perubahan dalam ROA atau Return on Assets. Perusahaan dengan Praktik CSR dan reputasi yang baik akan dilihat para stakeholder bahwa perusahaan memiliki performance yang baik. Secara umum Kinerja perusahaan dapat diukur dan diamati melalui 4 dasar penting yaitu Orientasi kewirausahaan (GEO), Orientasi pasar (MO), inter-organizational learning (IOL) dan Keunggulan kompetitif perusahaan (SCA). Selain itu Turbulensi teknologi juga berperan dalamm Firm Performance. Setiap metode memiliki cara pendekatan masing masing dalam mengamati firm performance |
| Date: | 2020–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:7c3dz&r=all |