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On the Determinants of Organizational Forgetting

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  • Guy David
  • Tanguy Brachet

Abstract

Studies of organizational learning and forgetting identify potential channels through which the firm's production experience is lost. These channels have differing implications for efficient resource allocation within the firm, but their relative importance has been ignored to date. We develop a framework for distinguishing the contributions of labor turnover and human capital depreciation to organizational forgetting. We apply our framework to a novel dataset of ambulance companies and their workforce. We find evidence of organizational forgetting, which results from skill decay and turnover effects. The latter has twice the magnitude of the former. (JEL D23, D83, J24, J63)

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/mic.3.3.100
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File URL: http://www.aeaweb.org/aej/mic/data/2009-0060_data.zip
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Journal: Microeconomics.

Volume (Year): 3 (2011)
Issue (Month): 3 (August)
Pages: 100-123

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Handle: RePEc:aea:aejmic:v:3:y:2011:i:3:p:100-123

Note: DOI: 10.1257/mic.3.3.100
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References

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  1. Peter Thompson, 2003. "How Much Did The Liberty Shipbuilders Forget?," Working Papers 0301, Florida International University, Department of Economics.
  2. Nijman, T.E. & Verbeek, M.J.C.M., 1992. "Testing for selectivity in panel data models," Open Access publications from Tilburg University urn:nbn:nl:ui:12-153280, Tilburg University.
  3. Peter Thompson, 1997. "How Much Did the Liberty Shipbuilders Learn? New Evidence for an Old Case Study," Development and Comp Systems 9712001, EconWPA.
  4. Rebecca Achee Thornton & Peter Thompson, 2001. "Learning from Experience and Learning from Others: An Exploration of Learning and Spillovers in Wartime Shipbuilding," American Economic Review, American Economic Association, vol. 91(5), pages 1350-1368, December.
  5. Charles D. Bailey, 1989. "Forgetting and the Learning Curve: A Laboratory Study," Management Science, INFORMS, vol. 35(3), pages 340-352, March.
  6. David, Guy & Chiang, Arthur J., 2009. "The determinants of public versus private provision of Emergency Medical Services," International Journal of Industrial Organization, Elsevier, vol. 27(2), pages 312-319, March.
  7. C. Lanier Benkard, 2000. "Learning and Forgetting: The Dynamics of Aircraft Production," American Economic Review, American Economic Association, vol. 90(4), pages 1034-1054, September.
  8. Robert S. Huckman & Gary P. Pisano, 2006. "The Firm Specificity of Individual Performance: Evidence from Cardiac Surgery," Management Science, INFORMS, vol. 52(4), pages 473-488, April.
  9. Verbeek, M.J.C.M. & Nijman, T.E., 1990. "Testing for selectivity bias in panel data models," Discussion Paper 1990-18, Tilburg University, Center for Economic Research.
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Cited by:
  1. Pilar Beneito & MarĂ­a Engracia Rochina-Barrachina & Amparo Sanchis, 2014. "The Path of R&D Efficiency over Time," Working Papers 1403, Department of Applied Economics II, Universidad de Valencia.
  2. Serdar Aldatmaz & Paige Ouimet & Edward D Van Wesep, 2014. "The Option To Quit: The Effect Of Employee Stock Options On Turnover," Working Papers 14-06, Center for Economic Studies, U.S. Census Bureau.
  3. Carolyn D. Egelman & Dennis Epple & Linda Argote & Erica R.H. Fuchs, 2013. "Learning by Doing in a Multi-Product Manufacturing Environment: Product Variety, Customizations, and Overlapping Product Generations," NBER Working Papers 19674, National Bureau of Economic Research, Inc.
  4. Jason Hockenberry & Lorens Helmchen, 2014. "The Nature of Surgeon Human Capital Depreciation," NBER Working Papers 20017, National Bureau of Economic Research, Inc.

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