CEF.UP – WiP Seminar/Webinar

Tuesday – March 19^st, 2024 at 1:00 p.m. | Room 305 | Online

Title: “Fissured Firms and Worker Outcomes” (with Matias Cortes – York University;  Diego Dabed – Utrecht University; Anna Salomons – Utrecht University)

Ana Oliveira – Utrecht University (Netherlands)

Abstract:

“We consider how firms’ organization of production relates to workers’ wages. Using matched employer-employee data from Portugal, we document that, within detailed industries, firms differ starkly in terms of their occupational employment concentration, with some firms employing workers across a broad range of occupations and others being much more specialized. These differences are robustly predictive of wages: a worker employed in a specialized, i.e. `fissured’ firm earns less than that same worker employed in a less specialized firm. This wage penalty cannot exclusively be explained by worker-firm sorting, and is observed across a wide range of occupations. Firm specialization helps account for the role of firms in inequality: over half of the wage penalty from specialization is explained by differences in firm productivity, and firm specialization is strongly negatively related to AKM firm fixed effects. However, the evidence does not support a large role for increased pay transparency or lower rent-sharing as mechanisms for the observed wage penalty from firm specialization.”