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on Business Economics |
| By: | Pylak, Korneliusz; Mickiewicz, Tomasz; Kitsos, Tasos |
| Abstract: | Our study explores the factors influencing the creation and closure of firms in urban micro-spaces, highlighting the relationship between Knowledge-Intensive Business Services (KIBS) and non-KIBS sectors. Employing 2007-2019 firm-level data from Warsaw, the capital of Poland, we uncover overlooked micro-geographical and sectoral patterns. We reveal spatial and sectoral interdependencies, highlighting the cross-sectoral effects of density and age of incumbent firms on new firm creation and closure. Our findings highlight the potential of policies supporting KIBS to generate positive multiplier effects, cultivating entrepreneurial ecosystems while accounting for micro-geographical contexts. |
| Date: | 2024–12–03 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:emv45 |
| By: | Rebecca Jack; Daniel Tennenbaum; Brenden Timpe |
| Abstract: | We document the dynamics of career paths around parenthood, capturing worker advancement within firms and across firms of differing pay. Using a new linkage between administrative data on U.S. workers’ fertility and labor-market histories, we show that the parental earnings gap is partly explained by mothers transitioning to lower-paying firms. Firm downgrading is driven by parents who take an extended absence from the labor force. Mothers who move to lower-paying firms see improved job amenities, but less generous fringe benefits. The firm’s contribution to the parental earnings gap rises over time and reaches one-third by the child’s 11th birthday. |
| Keywords: | Gender; gender earnings gap; Firms |
| JEL: | J20 J30 J16 |
| Date: | 2025–01–15 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedmoi:99456 |
| By: | Bridget Kauma; Giordano Mion |
| Abstract: | We propose a new data resource that attempts to overcome limitations of standard firm-level datasets for the UK (like the ARD/ABS) by building on administrative data covering the population of UK firms with at least one employee. We also construct a similar dataset for France and use both datasets to: 1) Provide some highlights of the data and an overall picture of the evolution of aggregate UK and French productivity and markups: 2) Analyse the spatial distribution of productivity in both countries at a fine level of detail – 228 Travel to Work Areas (TTWAs) for the UK and 297 Zones d‘emploi (ZEs) for France – while focusing on the role of economic density. Our findings suggest that differences in firm productivity across regions are magnified in the aggregate by an increasing productivity return of density along the productivity distribution. |
| Keywords: | firm-level dataset, merging, BSD, FAME, VAT, FICUS, FARE, productivity, markups, UK, France, regional disparities, density |
| JEL: | R12 D24 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11543 |
| By: | Ohnishi, Kazuhiro |
| Abstract: | Over the past approximately 30 years, many researchers have examined oligopoly models where firms endogenously select the timing of their action decisions. Therefore, this paper studies a mixed triopoly model featuring competition between a labour-managed firm, a capitalist firm and a state-owned firm. The sequence of events is as follows. In stage 0, each firm independently and simultaneously selects either ‘stage 1’ or ‘stage 2’. In this context, stage 1 denotes that a firm produces in stage 1, whereas stage 2 signifies that it produces in stage 2. In stage 1, if a firm opts for stage 1, it determines its output for this stage. In stage 2, if a firm chooses stage 2, it decides on its output for this stage. Upon the conclusion of the game, the market opens, and all firms sell their outputs. The purpose of this paper is to present the equilibrium outcome of triopoly competition where a state-owned firm, a labour-managed firm and a capitalist firm compete in quantities. As a result of the analysis, this paper reveals that there exists an equilibrium wherein both the labour-managed firm and the capitalist firm assume leadership roles. The paper finds that the state-owned firm is precluded from functioning as the Stackelberg leader. |
| Keywords: | Capitalist firm; Cournot game; Endogenous timing; Labour-managed firm; State-owned firm |
| JEL: | C72 D21 L30 |
| Date: | 2024–12–17 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123007 |
| By: | Michael Koch; Luca Macedoni; Angelina Odintsova |
| Abstract: | This paper studies how foreign acquisitions affect firms’ internal labor organization, particularly occupational switching. This focus is inspired by new stylized facts we document using linked employer-employee data from Denmark: while the total number of occupations and hierarchical layers in firms remains stable, a significant share of firms simultaneously add and drop occupations and layers each year. Applying a dynamic two-way fixed effects matching estimator, we find that foreign acquisitions lead to significant reorganization within firms: though the number of layers or occupations remains unchanged, firms exhibit substantial occupational churning among existing workers, especially among higher-paid employees. |
| Keywords: | occupation switching, firm organization, foreign acquisitions |
| JEL: | D22 D24 F23 G34 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11525 |
| By: | Conteduca, Francesco Paolo; Panon, Ludovic |
| Abstract: | Industries are not fully geographically concentrated, so that natural disasters can affect the degree of competition in the industry, forcing firms to adapt, and have aggregate consequences. Using administrative data, we show that natural disasters in Italy lead to a persistent decline in markups of affected manufacturing firms, particularly large ones. We implement an oligopolistic competition model with idiosyncratic shocks directly on the firm-level data and quantify how markup adjustments shape aggregate productivity and welfare. Our findings suggest that markup adjustments may have mitigated the impact of the 2012 Italian earthquake on aggregate productivity by approximately 30%. |
| Keywords: | Natural Disasters; Markups; Oligopolistic Competition; Aggregate Productivity; Misallocation; Firm Heterogeneity |
| JEL: | D22 D43 O47 Q54 |
| Date: | 2024–12–17 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:123008 |
| By: | Viral V. Acharya; Robert F. Engle III; Olivier Wang |
| Abstract: | We study how government policies and corporate commitments to decarbonize interact under two externalities: environmental damages and green innovation spillovers. Unconstrained carbon taxes and innovation subsidies could achieve first-best outcomes, but when government policies face constraints, commitments by large firms and institutional investors can serve as profit-driven coordination devices that spur green innovation and technology adoption, and thereby reduce overall transition costs. Firm commitments also enhance government policy credibility by lowering the need for high future carbon taxes. Our empirical evidence confirms that firm size and green common ownership drive Net Zero commitments and decarbonization investments. |
| JEL: | G3 H2 Q5 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33335 |
| By: | Marc-Andreas Muendler; James E. Rauch; Sergio Mikio Koyama |
| Abstract: | New firms do not yet have employees who can aid recruiting by referrals, but entrepreneurs can recruit workers they know to their startups—in effect making their own referrals. We consider new firms in Brazil’s formal sector founded between 2002 and 2014, for which at least one founding owner can be traced to previous formal employment. We find that 35.1 percent of new firms with at least five employees hire one or more coworkers from a founding owner’s last employer in their first year of operation, and that 9.2 percent of first-year hires at new firms were coworkers at a founding owner’s last employer. The former coworkers most likely to join a founding owner’s new firm are those who, at their last employer, worked in the same plant as a founding owner, had long overlap with a founding owner, were classified in the same industry or occupation as a founding owner, and were hired at roughly the same time as a founding owner. Controlling for observable human capital and new firm fixed effects, former coworkers earn eight percent higher initial wages at new firms and are six percentage points less likely to separate before a new firm’s second year of operation. We find that the coworker wage premium diminishes with tenure by 0.5 percentage points per year and the coworker separation premium diminishes with tenure by 2.0 percentage points per year. |
| Keywords: | job referrals, business formation, entrepreneurship, employee spinoffs, firm performance |
| JEL: | J63 L26 J24 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11520 |
| By: | Audrey Guo (Santa Clara University); Melanie Wallskog (Duke University) |
| Abstract: | How costly are taxes for young firms? In this paper, we demonstrate that even small payroll taxes significantly distort entry, growth, and hiring decisions. First, leveraging cross-sectional variation in the taxes faced by new employers, we find that higher taxes discourage new firms from hiring their first workers, with an elasticity of the number of new employers to taxes of -0.1. Second, studying changes in taxes after entry, we find that higher taxes lead more firms to exit, while also reducing employment for those who survive and leading some firms to avoid taxes by using non-taxable contract labor. |
| Keywords: | firm entry, young firms, labor costs, unemployment insurance |
| JEL: | H25 H71 L26 M13 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:upj:weupjo:24-410 |
| By: | Tranos, Emmanouil; Kitsos, Tasos; Wolf, Levi John (University of Bristol) |
| Abstract: | The discussion about the productivity gains from digital technologies is almost as old as digital technologies themselves. From early futuristic approaches to the various forms of the productivity paradox, there are still open questions regarding if and how the internet can lead to positive economic effects as well as their spatial heterogeneity. The usual caveat to unpack this relationship is data about internet usage that is detailed enough to be linked both to economic outputs and places. We develop a multilevel modelling framework and combine firm-level microdata with novel internet speed microdata illustrating how connectivity has been experienced by end-users. Although it is not possible to directly observe the online activities of individuals, these data allow us to approximate business usage. Additionally, we can distinguish between upload and download speeds, which is important as these channels can support different internet functions (e.g. video streaming vs. synchronous communications). We then observe firms, their productivity, and other firm characteristics and estimate the firm productivity effects of broadband speeds after accounting for spatial effects and platial characteristics, which are also associated with the underpinning digital divides. We find that increases in a place's internet speeds can lead to higher firm productivity whilst the opposite holds for instability of internet speeds. These results vary by sector and firm characteristics. Our results have significant policy implications, highlighting the economic impact of high-speed internet infrastructure planning decisions and presenting policymakers with a clear efficiency vs. equity trade-off. |
| Date: | 2024–12–02 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:va375 |