Firm Size, Productivity, and Manager Wages: A Job Assignment Approach∗

نویسندگان

  • Volker Grossmann
  • Tomer Blumkin
  • Hartmut Egger
  • Armin Falk
  • Gilles Saint-Paul
  • Dennis Snower
  • John Sutton
  • Jian Tong
چکیده

Ability of managers and other nonproduction professionals is key for the productivity of firms. Hence, the assignment of heterogeneous nonproduction workers across firms determines the distribution of productivity. In turn, the transmission of productivity differences into profit differences — resulting from product market competition — determines firms’ willingness to pay for higher managerial skills. This paper explores the equilibrium assignment of nonproduction workers across ex ante identical firms which results from this interaction between product market and the market for nonproduction skills. The analysis suggests that, typically, large and productive firms coexist with small, low-productivity firms. Consistent with empirical evidence, a skewed distribution of firm size tends to arise. Moreover, the model predicts a positive relationship of firm size to productivity, manager quality, and manager wages. Finally, according to comparative-static analysis, higher intensity of product market competition can account for increases in the compensation at the top of the wage distribution.

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

منابع مشابه

Job to Job Movements in a Simple Search Model

On the job search is a key feature of real life labor markets. Yet, traditional equilibrium unemployment theory has not been able to account for on-thejob search in a satisfactory manner. In this paper we present an equilibrium model which includes on-thejob search as an optimal response to search frictions and differences in firm productivity. Our model is laid out in detail in ongoing researc...

متن کامل

The Impact of Training on Productivity and Wages. Evidence from Belgian Firm Level Panel Data

This paper uses longitudinal data of more than 13,000 firms to analyze the effects of on-the-job training on firm level productivity and wages. Workers receiving training are on average more productive than workers not receiving training. This makes firms more productive. On-the-job training increases firm level measured productivity between 1 and 2%, compared to firms that do not provide train...

متن کامل

Managerial Job Assignment and Imperfect Competition in Asymmetric Equilibrium

This paper develops a model with multiple market locations in which the quality of intangible assets of firms, provided by management, determines the firms. performance. Despite an ex ante symmetry of potential entrants, the equilibrium assignment of heterogeneous managerial skills to firms tends to be asymmetric. This sorting outcome determines both the goods market structure at single locatio...

متن کامل

Essays on the Role of Institutions in Productivity and Reallocation Dynamics

Title of dissertation: ESSAYS ON THE ROLE OF INSTITUTIONS IN PRODUCTIVITY AND REALLOCATION DYNAMICS Helena Schweiger, Doctor of Philosophy, 2006 Dissertation directed by: Professor John C. Haltiwanger Department of Economics Recent empirical work has shown that the success of an economy depends largely on how successful it is in allocating inputs and outputs across businesses efficiently with m...

متن کامل

Labor Market Friction, Firm Heterogeneity, and Aggregate Employment and Productivity

The paper is based on a synthesis of a "product variety" version of the firm life cycle model developed by Klette and Kortum (2004) and an equilibrium search model of the labor market with job to job flows introducted by Mortensen (2003). In the construction, a continuum of intermediate product and service varieties are produced with labor that serve as inputs in the production of a final good....

متن کامل

ذخیره در منابع من


  با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

عنوان ژورنال:

دوره   شماره 

صفحات  -

تاریخ انتشار 2006