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Productivity Shocks and Labour Market Outcomes for Top Earners: Evidence from Italian Serie A

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  • Vincenzo Carrieri
  • Andrew M. Jones
  • Francesco Principe

Abstract

How are top earners affected by productivity shocks? We address this question using a unique longitudinal data set on the universe of professional football players in the Italian Serie A, representing 20% of top earners in Italy. We use traumatic injuries and adopt an IV strategy to provide causal estimates of the impact of productivity shocks on several labour market outcomes. We find that a 30‐day injury substantially affects the probability of contract renegotiation and reduces net wages by around 12%. We show that this large penalty is due to employer's precautionary motives rather than to shock‐induced reduction in current player's performance.

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  • Vincenzo Carrieri & Andrew M. Jones & Francesco Principe, 2020. "Productivity Shocks and Labour Market Outcomes for Top Earners: Evidence from Italian Serie A," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 82(3), pages 549-576, June.
    • Handle: RePEc:bla:obuest:v:82:y:2020:i:3:p:549-576
    DOI: 10.1111/obes.12347
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    4. Ubaldi, Michele & Picchio, Matteo, 2023. "Intergenerational Scars: The Impact of Parental Unemployment on Individual Health Later in Life," IZA Discussion Papers 16103, Institute of Labor Economics (IZA).
    5. von Hinke, Stephanie & Rice, Nigel & Tominey, Emma, 2022. "Mental health around pregnancy and child development from early childhood to adolescence," Labour Economics, Elsevier, vol. 78(C).
    6. Ekaterina Aleksandrova & Venera Bagranova & Christopher J Gerry, 2021. "The effect of health shocks on labour market outcomes in Russia [Ageing and unused capacity in Europe: is there an early retirement trap?]," Cambridge Journal of Economics, Oxford University Press, vol. 45(6), pages 1319-1336.
    7. Karol Kempa, 2022. "Task-specific human capital and returns to specialization: evidence from association football [All about balance? A test of the jack-of-all-trades theory using military enlistment data]," Oxford Economic Papers, Oxford University Press, vol. 74(1), pages 136-154.

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