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Two perspectives on multiskilling and product-market volatility

  • DeVaro, Jed
  • Farnham, Martin

We study the effect of product-market volatility on a firm's choice between multiskilling and specialization. We construct a theoretical model that captures the tradeoff between multiskilling (which gives greater flexibility to reassign workers in production) and specialization (which provides workers with the expertise to respond to product market signals in their area of specialty). Using data from a nationally-representative cross section of British establishments, we find that greater volatility is associated with greater specialization. This result holds both inside and outside of manufacturing, but consistent with our model, it holds only in multi-product establishments and not in single-product ones.

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Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 18 (2011)
Issue (Month): 6 ()
Pages: 862-871

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Handle: RePEc:eee:labeco:v:18:y:2011:i:6:p:862-871
Contact details of provider: Web page: http://www.elsevier.com/locate/labeco

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  1. Lindbeck, Assar & Snower, Dennis J, 2000. "Multitask Learning and the Reorganization of Work: From Tayloristic to Holistic Organization," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 353-76, July.
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  7. Paul Osterman, 1994. "How common is workplace transformation and who adopts it?," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(2), pages 173-188, January.
  8. BOUCEKKINE, Raouf & CRIFO, Patricia, 2003. "Human capital accumulation and the transition from specialization to multi-tasking," CORE Discussion Papers 2003080, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  9. Hodaka Morita, 2005. "Multi-skilling, Delegation and Continuous Process Improvement: A Comparative Analysis of US-Japanese Work Organizations," Economica, London School of Economics and Political Science, vol. 72(285), pages 69-93, 02.
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  11. Kato, Takao & Owan, Hideo, 2007. "Market Characteristics, Intra-Firm Coordination, and the Choice of Human Resource Management Systems: Evidence from New Japanese Data," Working Papers 07-10, University of Aarhus, Aarhus School of Business, Department of Economics.
  12. Elizabeth Webster, 2003. "Firms' Decisions to Innovate and Innovation Routines," Melbourne Institute Working Paper Series wp2003n05, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  13. Edward P. Lazear, 2009. "Firm-Specific Human Capital: A Skill-Weights Approach," Journal of Political Economy, University of Chicago Press, vol. 117(5), pages 914-940, October.
  14. Jed DeVaro, 2005. "Teams, Autonomy, and the Financial Performance of Firms," Labor and Demography 0508004, EconWPA.
  15. Jaime Ortega, 2001. "Job Rotation as a Learning Mechanism," Management Science, INFORMS, vol. 47(10), pages 1361-1370, October.
  16. Metin M. Cosgel & Thomas J. Miceli, 1999. "Job Rotation: Cost, Benefits, and Stylized Facts," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 155(2), pages 301-, June.
  17. Wouter Dessein & Tano Santos, 2006. "Adaptive Organizations," Journal of Political Economy, University of Chicago Press, vol. 114(5), pages 956-985, October.
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  19. Cindy Zoghi & Alec Levenson & Michael Gibbs, 2005. "Why Are Jobs Designed the Way They Are?," Working Papers 382, U.S. Bureau of Labor Statistics.
  20. Jed DeVaro, 2005. "The Effects of Self-Managed and Closely-Managed Teams on Labor Productivity and Product Quality: An Empirical Analysis of a Cross Section of Establishments," Labor and Demography 0510002, EconWPA.
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