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on Business Economics |
| By: | Audinga Baltrunaite (Bank of Italy); Sara Formai (Bank of Italy); Andrea Linarello (Bank of Italy); Sauro Mocetti (Bank of Italy) |
| Abstract: | We explore the role of ownership, governance and management characteristics as potential drivers of the performance gaps between firms located in the Centre and North and in the South of Italy. First, we document that southern firms are characterized by more frequent family ownership and a higher fraction of local and family directors on the board. Moreover, entrepreneurs and managers of southern firms have lower education levels and are less inclined to adopt structured managerial practices and advanced technology. Second, we examine to what extent these differences account for the performance gap between the two areas. We find that managers’ human capital explains one tenth of the difference in firm size, while family ownership accounts for one tenth of the differences in productivity. Although the analysis is purely descriptive, our findings suggest that ownership, governance and management play a significant role in explaining firm performance and account for a non-negligible fraction of the North-South divide. |
| Keywords: | ownership, family firms, corporate governance, managerial practices, human capital, firm size, productivity, technology |
| JEL: | G30 L20 M10 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_678_22&r= |
| By: | Joachim Wagner (Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre) |
| Abstract: | This paper uses firm level data from the Flash Eurobarometer 421 survey conducted in June 2015 in 34 European countries to investigate the link between having a website and international firm activities in small and medium sized enterprises (SMEs). We find that firms which are present in the web do more often export, import, engage in research and development cooperation with international partners, work as subcontractors for firms from other countries, use firms in other countries as subcontractors, and perform foreign direct investments – both inside and outside the European Union. The estimated website premia are statistically highly significant after controlling for firm size, country, and sector of economic activity. Furthermore, the size of these premia can be considered to be large. Internationally active firms tend to have a website. |
| Keywords: | Website premia, international firm activities, Flash Eurobarometer 421 |
| JEL: | D22 F14 F23 L25 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:410&r= |
| By: | Luca Coraggio (Università di Napoli Federico II); Marco Pagano (University of Naples Federico II, CSEF and EIEF.); Annalisa Scognamiglio (Università di Napoli Federico II and CSEF); Joacim Tåg (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Does the matching between workers and jobs help explain productivity differentials across firms? To address this question we develop a job-worker allocation quality measure (JAQ) by combining employer-employee administrative data with machine learning techniques. The proposed measure is positively and significantly associated with labor earnings over workers’ careers. At firm level, it features a robust positive correlation with firm productivity, and with managerial turnover leading to an improvement in the quality and experience of management. JAQ can be constructed for any employer-employee data including workers’ occupations, and used to explore the effect of corporate restructuring on workers’ allocation and careers. |
| Keywords: | jobs, workers, matching, mismatch, machine learning, productivity, management. |
| JEL: | D22 D23 D24 G34 J24 J31 J62 L22 L23 M12 M54 |
| Date: | 2022–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:641&r= |
| By: | Satyajit Chatterjee; Burcu Eyigungor |
| Abstract: | Larger firms (by sales or employment) have higher leverage. This pattern is explained using a model in which firms produce multiple varieties, acquire new varieties from their inventors, and borrow against the future cash flow of the firm with the option to default. A variety can die with a constant probability, implying that firms with more varieties (bigger firms) have a lower variance of sales growth and, in equilibrium, higher leverage. In this setup, a drop in the risk-free rate increases the value of an acquisition more for bigger firms because of their higher leverage: They can (and do) borrow a larger fraction of their future cash flow. The drop causes existing firms to buy more of the new varieties arriving into the economy, resulting in a lower startup rate and greater concentration of sales. |
| Keywords: | Startup rates; concentration; leverage; firm dynamics |
| JEL: | E22 E43 E44 G32 G33 G34 |
| Date: | 2022–03–17 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:93850&r= |
| By: | Michael Kirker; Lynda Sanderson (The Treasury) |
| Abstract: | Linked employer-employee data from New Zealand is used to study the relationship between a firm’s productivity growth and its exposure to outside knowledge through the hiring of new workers with previous work experience. The estimated relationship between productivity growth and hiring is compared to the predictions implied by two different channels: worker quality and knowledge spillover. Although it is not possible to identify a causal relationship, the productivity of a worker’s previous employer is correlated with subsequent productivity growth at the hiring firm. The patterns of this correlation are consistent with both the worker quality and knowledge spillover channels operating simultaneously. Furthermore, if knowledge spillover is occurring, the results suggest the type of knowledge spilling over relates to technological knowledge allowing firms to become more capital intensive, rather than knowledge that improves the efficiency of utilising existing inputs. |
| Keywords: | productivity; labour mobility; human capital; knowledge diffusion |
| JEL: | D24 J24 J62 O33 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:nzt:nztwps:22/01&r= |
| By: | Corey Allan (Ministry of Business, Innovation & Employment); David C. Maré (Motu Economic and Public Policy Research) |
| Abstract: | We continue our examination of inclusive growth at the firm level by examining heterogeneity in rent sharing in New Zealand using linked employer-employee data. We test for heterogeneity in rent sharing across a range of worker and firm characteristics including gender, ethnicity, age, qualifications, tenure, firm size, firm age, and industry. We also refine our measure of quasi-rents and estimate the level of excess quasi-rents per worker, or the amount of rents above the threshold beyond which rent sharing occurs. We find that between 20% and 30% of workers are in firms that earn zero excess rents. These workers are concentrated in the hospitality, administrative services, and retail industries and are more likely to be women, to be M?ori or Pacific peoples, and have lower-level qualifications. We find an overall rent-sharing elasticity of 0.03, which is equivalent to a $38 increase in annual wages in response to a $1,000 increase in excess rents per worker. We find differences in rent sharing by levels of highest qualification, tenure, and ethnicity. We find no differences in rent sharing by firm size or firm age. Rent sharing is similar across industries, with workers in most industries receiving between $1,500 and $2,000 of rents per year. The auxiliary finance and professional, scientific, and technical services sectors share the most, while grocery retailing, food and beverage manufacturing and utilities share the least. Insurance type behaviour by firms is consistent with the variation in rent sharing across industries, although differences in bargaining power are also likely to play a role in explaining differences in rent sharing across groups. |
| Keywords: | Wage determination; Rent-sharing; imperfect competition. |
| JEL: | J3 J71 J10 D22 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:22_03&r= |
| By: | Görg, Holger; Mulyukova, Alina |
| Abstract: | This paper exploits time and geographic variation in the adoption of Special Economic Zones in India to assess the direct and spillover effects of the program. We combine geocoded firm-level data and geocoded SEZs using a concentric ring approach, thus creating a novel dataset of firms with their assigned SEZ status. To overcome the selection bias we employ inverse probability weighting with time-varying covariates in a difference-in-differences framework. Our analysis yields that conditional on controlling for initial selection, the establishment of SEZs induced no further productivity gains for within SEZ firms, on average. This effect is predominantly driven by relatively less productive firms, whereas more productive firms experienced significant productivity gains. However, SEZs created negative externalities for firms in the vicinity which attenuate with distance. Neighbouring domestic firms, large firms, manufacturing firms and non-importer firms are the main losers of the program. Evidence points at the diversion of inputs from non-SEZ to SEZ-firms as a potential mechanism. |
| Keywords: | Special Economic Zones,India,TFP growth,firm performance,spillovers,time-varyingtreatment |
| JEL: | O18 O25 P25 R10 R58 R23 F21 F60 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2209&r= |
| By: | Francesco Bripi (Bank of Italy); Raffaello Bronzini (Bank of Italy); Elena Gentili (Bank of Italy); Andrea Linarello (Bank of Italy); Elisa Scarinzi (Bank of Italy) |
| Abstract: | In this paper, we study the structural change in the Centre-North and the South of Italy, focusing on its implications for productivity dynamics and its microeconomic determinants. We document three main results. First, between 2001 and 2018 the deindustrialization process involved both parts of Italy, but in the South it started after the financial crisis and was more pronounced. In the southern regions, the employment shares in low knowledge-intensive services increased more than in the Centre-North, whereas those in the high knowledge-intensive services increased less. Second, structural changes slowed down productivity growth in the Centre-North, but had no role in the fall of productivity registered in the South. Finally, in the Centre-North employment growth has been driven by the net creation of jobs among incumbents and larger firms. In contrast, employment dynamics in the southern regions largely reflected the process of firms entering and exiting the market, in particular in less knowledge-intensive service sectors, and in young and smaller enterprises. |
| Keywords: | structural change, firm dynamics, North-South gap, productivity growth, shift-share analysis |
| JEL: | R00 R11 L16 O41 O47 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_676_22&r= |
| By: | Flavio Calvino (OECD); Stefano DeSantis (Italian National Institute of Statistics); Isabelle Desnoyers-James (OECD); Sara Formai (Bank of Italy); Ilaria Goretti (OECD); Silvia Lombardi (Italian National Institute of Statistics); Francesco Manaresi (OECD); Giulio Perani (Italian National Institute of Statistics) |
| Abstract: | The study identifies the main factors that affect the diffusion of digital technologies and their returns among Italian firms, highlighting the crucial role of public policies. It uses a unique data infrastructure that integrates information on digital technology adoption, firm performance, and workers’ and managers’ skills. The analysis shows that the low digitalisation of Italian firms, especially of SMEs, can be traced back to the low levels of three factors: i) workers’ skills, ii) management capabilities, and iii) accumulation of intangible assets. These factors are also crucial to maximise the effectiveness of public policies supporting firm digitalisation, such as the deployment of broadband infrastructure and fiscal incentives to investments in digital technologies. Finally, the analysis shows that the COVID-19 crisis contributed to further widening the digital gap between Italian firms, favouring ex-ante more digitalised companies, suggesting that public policies play a crucial role for the post-COVID-19 recovery. |
| Date: | 2022–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:stiaac:126-en&r= |