The Impact of Workplace Conditions on Firm Performance
AbstractThis paper estimates the impact of work environment health and safety practice on firm performance, and examines which firm-characteristic factors are associated with good work conditions. We use Danish longitudinal register matched employer-employee data, merged with firm business accounts and detailed cross-sectional survey data on workplace conditions. This enables us to address typical econometric problems such as omitted variables bias or endogeneity in estimating i) standard production functions augmented with work environment indicators and aggregate employee characteristics and ii) firm mean wage regressions on the same explanatory variables. Our findings suggest that improvement in some of the physical dimensions of the work health and safety environment (specifically, “internal climate” and “repetitive and strenuous activity”) strongly impacts the firm productivity, whereas “internal climate” problems are the only workplace hazards compensated for by higher mean wages.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 08-077/3.
Date of creation: 28 Aug 2008
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occupational health and safety; work environment; production function estimation; firm performance; compensating wage differentials;
Other versions of this item:
- Buhai, Sebastian & Cottini, Elena & Westergaard-Nielsen, Niels, 2008. "The impact of workplace conditions on firm performance," Working Papers 08-13, University of Aarhus, Aarhus School of Business, Department of Economics.
- J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-09-20 (All new papers)
- NEP-BEC-2008-09-20 (Business Economics)
- NEP-EFF-2008-09-20 (Efficiency & Productivity)
- NEP-LAB-2008-09-20 (Labour Economics)
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- Jones, Melanie K. & Latreille, Paul L. & Sloane, Peter J., 2011. "Job Anxiety, Work-Related Psychological Illness and Workplace Performance," IZA Discussion Papers 5809, Institute for the Study of Labor (IZA).
- Böckerman, Petri & Ilmakunnas, Pekka, 2010. "The job satisfaction-productivity nexus: A study using matched survey and register data," MPRA Paper 23348, University Library of Munich, Germany.
- Cristini, Annalise & Eriksson, Tor & Pozzoli, Dario, 2011.
"High-Performance Management Practices and Employee Outcomes in Denmark,"
11-1, University of Aarhus, Aarhus School of Business, Department of Economics.
- Cristini, Annalisa & Eriksson, Tor & Pozzoli, Dario, 2012. "High-Performance Management Practices and Employee Outcomes in Denmark," IZA Discussion Papers 6984, Institute for the Study of Labor (IZA).
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