The Persistence of Differences in Productivity, Wages, Skill Mixes and Profits Between Firms
AbstractIn this paper, we construct a dynamic assignment model that can provide a unified explanation of several observed features of persistent differences in productivity, wages, skill mixes and profits between firms. Large organization capital (high firm-specific knowledge) attracts skilled workers, who can create further organization capital in the future. This positive feedback brings about persistent differences in these variables. We also analyze how the real and perceived values of a firm's organization capital interactively influence persistence. We estimate parameters and simulate the model. Our results show that a positive assignment mechanism accounts for a large part of the observed persistence.
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Bibliographic InfoPaper provided by Osaka School of International Public Policy, Osaka University in its series OSIPP Discussion Paper with number 07E002.
Length: 71 pages
Date of creation: Mar 2007
Date of revision:
Organization Capital; Assignment; Persistence;
Other versions of this item:
- Katsuya Takii, 2007. "The Persistence of Differences in Productivity, Wages, Skill Mixes and Profits Between Firms," Discussion Papers in Economics and Business 07-10, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-04-09 (All new papers)
- NEP-BEC-2007-04-09 (Business Economics)
- NEP-DGE-2007-04-09 (Dynamic General Equilibrium)
- NEP-KNM-2007-04-09 (Knowledge Management & Knowledge Economy)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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