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on Business Economics |
| By: | Haltiwanger, John C. (University of Maryland); Hyatt, Henry R. (U.S. Census Bureau); Spletzer, James R. (U.S. Census Bureau) |
| Abstract: | Most of the rise in overall earnings inequality is accounted for by rising between-industry dispersion from about ten percent of 4-digit NAICS industries. These thirty industries are in the tails of the earnings distribution, and are clustered especially in high-paying high-tech and low-paying retail sectors. The remaining ninety percent of industries contribute little to between-industry earnings inequality. The rise of employment in mega firms is concentrated in the thirty industries that dominate rising earnings inequality. Among these industries, earnings differentials for the mega firms relative to small firms decline in the low-paying industries but increase in the high-paying industries. We also find that increased sorting and segregation of workers across firms mainly occurs between industries rather than within industries. |
| Keywords: | inequality, firm size, industry, wage differentials, sorting, segregation, pay premium |
| JEL: | J31 J21 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15197&r= |
| By: | Arianna Martinelli; Julia Mazzei; Daniele Moschella |
| Abstract: | The recent surge of patent disputes plays an important role in discouraging firms from entering new technology domains (TDs). Using a large-scale dataset combining data from the EPO-PATSTAT database and ORBIS-IP and containing patents applied at EPO between 2000 and 2015, we construct a new measure of litigiousness using patent opposition data. We find that the degree of litigiousness and the density of patent thickets negatively affect the likelihood of firms entering new TDs. Across technologies, the frequency of oppositions discourages firms mostly in high-tech industries. Across firms, the risk of opposition falls disproportionately on small rather than large firms. Finally, for large firms, we observe a sort of learning-by-being-opposed effect. This evidence suggests that litigiousness and hold-up potential discourage firms from entering new TDs, shaping Schumpeterian patterns of innovation characterized by a stable number of large-established firms and a lower degree of turbulence. |
| Keywords: | Patent opposition; Technological entry; Innovation Strategies. |
| Date: | 2022–05–02 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2022/12&r= |
| By: | Hamid Firooz; Zheng Liu; Yajie Wang |
| Abstract: | Since the early 2000s, a rising share of production has been concentrated in a small number of superstar firms. We argue that the rise of automation technologies and the cross-sectional variation of robot use rates have contributed to the increases in industrial concentration. Motivated by empirical evidence, we build a general equilibrium model with heterogeneous firms, endogenous automation decisions, and variable markups. Firms choose between two types of technologies, one uses workers only and the other uses both workers and robots subject to an idiosyncratic fixed cost of robot operation. Larger firms are more profitable and are thus more likely to choose the automation technology. A decline in the cost of robot adoption increases the relative automation usage by large firms, raising their market share of sales. However, the employment share of large firms does not increase as much as the sales share because the expansion of large firms relies more on robots than on workers. Our calibrated model predicts a cross-sectional distribution of automation usage in line with firm-level data. The model also implies that a decline in automation costs reduces the labor income share and raises the average markup, both driven by between-firm reallocation, consistent with empirical evidence. |
| Keywords: | automation; market concentration; labor share; markup; reallocation; heterogeneous firms |
| JEL: | E24 L11 O33 |
| Date: | 2022–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:93948&r= |
| By: | Xiangtai Zuo (Shutter Zor) |
| Abstract: | In recent years, more and more state-owned enterprises (SOEs) have been embedded in the restructuring and governance of private enterprises through equity participation, providing a more advantageous environment for private enterprises in financing and innovation. However, there is a lack of knowledge about the underlying mechanisms of SOE intervention on corporate innovation performance. Hence, in this study, we investigated the association of state capital intervention with innovation performance, meanwhile further investigated the potential mediating and moderating role of managerial sentiment and financing constraints, respectively, using all listed non-ST firms from 2010 to 2020 as the sample. The results revealed two main findings: 1) state capital intervention would increase innovation performance through managerial sentiment; 2) financing constraints would moderate the effect of state capital intervention on firms' innovation performance. |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2204.04860&r= |
| By: | Iman Cheratian; Saleh Goltabar; Mohammad Reza Farzanegan |
| Abstract: | Given the importance of firm strategic management in time of crises, this study investigates Micro, Small, and Medium Enterprises (MSMEs) survival strategies during the international sanctions against Iran. Using data from a questionnaire of 486 firms between December 2019 to September 2020, we found that firm strategies in reducing research and development (R&D) expenditures, marketing costs, and fixed/overhead costs and investing in information technology (IT) are positively related to their survivability. Conversely, managerial decisions to “reduce production” and “staff pay cut/freeze” have negative and significant impacts on a firm’s ability to survive during sanctions. Moreover, micro firms are more resilient than their small and medium counterparts. The findings also confirm that age has a significant and positive impact on firm survival. Finally, the results show that having a business plan, access to finance and technology, owner education, export orientation, business networking and consulting services are the key drivers of withstanding the pressure from sanctions. |
| Keywords: | crisis, recession, sanction, survival strategies, firm, Iran |
| JEL: | F51 M13 L25 L26 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9568&r= |
| By: | Jonathan Eaton; Samuel Kortum; Francis Kramarz |
| Abstract: | Customs data reveal heterogeneity and granularity of relationships among buyers and sellers. A key insight is how more exports to a destination break down into more firms selling there and more buyers per exporter. We develop a quantitative general equilibrium model of firm-to-firm matching that builds on this insight to separate the roles of iceberg costs and matching frictions in gravity. In the cross section, we find matching frictions as important as iceberg costs in impeding trade, and more sensitive to distance. Because domestic and imported intermediates compete directly with labor in performing production tasks, our model also fits the heterogeneity of labor shares across French producers. Applying the framework to the 2004 expansion of the European Union, reduced iceberg costs and reduced matching frictions contributed equally to the increase in French exports to the new members. While workers benefited overall, those competing most directly with imports gained less, even losing in some countries entering the EU. |
| JEL: | F12 F14 F16 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9557&r= |
| By: | Gerard Domènech Gironell (Universitat de Barcelona); Marina Núñez Oliva (Universitat de Barcelona) |
| Abstract: | In the multiple-partners job market, introduced in (Sotomayor, 1992), each firm can hire several workers and each worker can be hired by several firms, up to a given quota. We show that, in contrast to what happens in the simple assignment game, in this extension, the firms-optimal stable rules are neither valuation monotonic nor pairwise monotonic. However, we show that the firms-optimal stable rules satisfy a weaker property, what we call firmcovariance, and that this property characterizes these rules among all stable rules. This property allows us to shed some light on how firms can (and cannot) manipulate the firms-optimal stable rules. In particular, we show that firms cannot manipulate them by constantly over-reporting their valuations. Analogous results hold when focusing on the workers. Finally, we extend to the multiple-partners market a known characterization of the fair-division rules on the domain of simple assignment games. |
| Keywords: | Assignment game, stable rules, fair division. |
| JEL: | C78 D78 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ewp:wpaper:419web&r= |