Profit sharing and employment stability
AbstractThis paper tests the hypothesis that workers whose compensation packages contain a profit-sharing component are less susceptible to layoff in the face of negative shocks to product demand than are workers paid a fixed, time-based wage. The theory is tested on two data sets, one a household survey and the other a survey of small businesses conducted by the authors. The characteristics of profit sharing among small businesses by and large meet the theoretical requirements for stabilizing employment, and the authors do find evidence in both samples to support the hypothesis; the evidence, however, is of borderline statistical significance and is therefore more suggestive than definitive. (Abstract courtesy JSTOR.)
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Bibliographic InfoArticle provided by ILR Review, Cornell University, ILR School in its journal ILR Review.
Volume (Year): 43 (1990)
Issue (Month): 3 (February)
Postal: 381 Ives East, Cornell University, Ithaca, NY 14853-3901
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- Colin Green & J S Heywood, 2007. "Does profit sharing increase training by reducing turnover?," Working Papers 589032, Lancaster University Management School, Economics Department.
- Drago, Robert & Turnbull, Geoffrey K., 1996. "On the incidence of profit sharing," Journal of Economic Behavior & Organization, Elsevier, vol. 31(1), pages 129-138, October.
- Derek C. Jones & Takao Kato & Jeffrey Pliskin, 1994.
"Profit Sharing and Gainsharing: A Review of Theory, Incidence, and Effects,"
Economics Working Paper Archive
wp_125, Levy Economics Institute, The.
- Derek C. Jones & Takao Kato & Jeffrey Pliskin, 1999. "Profit Sharing and Gainsharing: A Review of Theory, Incidence, and Effects," Macroeconomics 9903010, EconWPA.
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