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on Business Economics |
| By: | Camarero Garcia, Sebastian; Murmann, Martin |
| Abstract: | Business creation is economically important, and unemployment precedes the creation of a substantial share of new firms. Yet, most research has focused on analyzing the effects of unemployment insurance policies on re-employment outcomes, ignoring self-employment. In this paper, we analyze how the potential duration of unemployment benefits, a fundamental design choice of unemployment insurance systems, affects whether new firms are founded out of opportunity or necessity and their growth potential. To this end, we construct a comprehensive dataset on German firm founders that links administrative social insurance information with business survey data. Exploiting reform and age-related exogenous variation in the potential duration of unemployment benefits, we find that longer potential benefit duration implies longer actual unemployment and, as a consequence, more necessity entrepreneurship and worse startup outcomes in terms of sales and employment growth. We explain this overall effect of potential benefit duration through a mix of compositional and individual-level duration effects. Our findings underline that new firms started out of unemployment are a highly heterogeneous group and suggest that the (optimal) design of unemployment insurance systems has important externalities on whether innovation- and growth-oriented firms are started out of unemployment. |
| Keywords: | entrepreneurship, unemployment insurance, self-employment, opportunity entrepreneurship, fiscal externality |
| JEL: | L26 M13 L11 L25 D22 J21 J23 J44 J62 J64 J65 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:bubdps:301863 |
| By: | Gagliardi, Nicola; Grinza, Elena; Rycx, François |
| Abstract: | In this paper, we investigate the impact of rising temperatures on firm productivity using longitudinal firm-level balance-sheet data from private sector firms in 14 European countries, combined with detailed weather data, including temperature. We begin by estimating firms' total factor productivity (TFP) using control-function techniques. We then apply multiple-way fixed-effects regressions to assess how higher temperature anomalies affect firm productivity - measured via TFP, labor productivity, and capital productivity. Our findings reveal that global warming significantly and negatively impacts firms' TFP, with the most adverse effects occurring at higher anomaly levels. Labor productivity declines markedly as temperatures rise, while capital productivity remains unaffected - indicating that TFP is primarily affected through the labor input channel. Our moderating analyses show that firms involved in outdoor activities, such as agriculture and construction, are more adversely impacted by increased warming. Manufacturing, capital-intensive, and blue-collar-intensive firms, compatible with assembly-line production settings, also experience significant productivity declines. Geographically, the negative impact is most pronounced in temperate and mediterranean climate areas, calling for widespread adaptation solutions to climate change across Europe. |
| Keywords: | Climate change, Global warming, Firm productivity, Total factor productivity (TFP), Semiparametric methods to estimate production functions, Longitudinal firm-level data |
| JEL: | D24 J24 Q54 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1485 |
| By: | Bettiol, Marco; Capestro, Mauro; Di Maria, Eleonora; Ganau, Roberto |
| Abstract: | Does Industry 4.0 technology adoption push firms’ labor productivity? We contribute to the literature debate—mainly focused on robotics and large firms—by analyzing adopters’ labor productivity returns when micro, small, and medium enterprises (MSME) are concerned. We employ original survey data on Italian MSMEs’ adoption investments related to a multiplicity of technologies and rely on a difference-in-differences estimation strategy. Results highlight that Industry 4.0 technology adoption leads to a 7% increase in labor productivity. However, this effect decreases over time and is highly heterogeneous with respect to the type, the number, and the variety of technologies adopted. We also identify potential channels explaining the labor productivity returns of technology adoption: cost-related efficiency, new knowledge creation, and greater integration/collaboration both within the firm and with suppliers. |
| Keywords: | Industry 4.0; Italy; labor productivity; MSME; technology adoption |
| JEL: | R14 J01 J1 |
| Date: | 2024–04–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:124545 |
| By: | Black, Ines (Duke University); Figueiredo, Ana (Vrije Universiteit Amsterdam) |
| Abstract: | We show that occupation mobility creates the illusion of cyclical hiring wages. Using administrative data, we find that wages of new hires who remain in the same occupation are no more cyclical than those of existing workers, whereas wages of occupation switchers are highly cyclical. We uncover higher wage cyclicality also among workers who switch occupations within the same firm. Moreover, wage cyclicality increases, the more different current and previous occupations' required skills. Our results suggest that the widely documented cyclicality of entry wages reflects composition effects due to changes in match quality in worker's occupation, rather than wage flexibility. |
| Keywords: | wage cyclicality, occupational mobility, reallocation, match quality |
| JEL: | J31 J61 E24 E32 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17189 |