IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Trade and the Firm-Internal Allocation of Workers to Tasks

  • Hartmut Egger
  • Michael Koch

This paper looks inside the firm and investigates how trade alters the matching of worker-specific abilities and task-specific skill requirements. The outcome of this matching depends on how firms organize their recruitment process and how much they invest into the screening of applicants. In the open economy, the most productive firms start exporting. They increase their market share and therefore find it attractive to increase their screening investment, which improves the matching outcome. Things are different for non-exporters, whose market share shrinks in the open economy, lowering their incentives to invest for screening applicants. Due to this asymmetric response, access to trade raises the dispersion of labor productivity between heterogeneous producers, while at the same time increasing the average quality of worker-task matches and thus economy-wide labor productivity. The productivity-enhancing effect of endogenous adjustments in the firm-internal allocation of workers to tasks points to a so far unexplored channel through which gains from trade can materialize.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.bgpe.de/texte/DP/139_EggerKoch.pdf
File Function: First version, 2013
Download Restriction: no

Paper provided by Bavarian Graduate Program in Economics (BGPE) in its series Working Papers with number 139.

as
in new window

Length: 37 pages
Date of creation: Jul 2013
Date of revision:
Handle: RePEc:bav:wpaper:139_eggerkoch
Contact details of provider: Web page: http://www.bgpe.de/

More information through EDIRC

References listed on IDEAS
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.:

as in new window
  1. Patrick Legros & Andrew Newman, 2002. "Monotone matching in perfect and imperfect worlds," ULB Institutional Repository 2013/7032, ULB -- Universite Libre de Bruxelles.
  2. Tor Eriksson & Jaime Ortega, 2006. "The Adoption of Job Rotation: Testing the Theories," ILR Review, Cornell University, ILR School, vol. 59(4), pages 653-666, July.
  3. Amiti, Mary & Davis, Donald R, 2008. "Trade, Firms, and Wages: Theory and Evidence," CEPR Discussion Papers 6872, C.E.P.R. Discussion Papers.
  4. Elhanan Helpman & Oleg Itskhoki, 2010. "Labour Market Rigidities, Trade and Unemployment," Review of Economic Studies, Oxford University Press, vol. 77(3), pages 1100-1137.
  5. Elhanan Helpman & Oleg Itshoki & Stephen Redding, 2009. "Inequality and unemployment in a global economy," LSE Research Online Documents on Economics 25501, London School of Economics and Political Science, LSE Library.
  6. Shy, Oz, 1988. "A general equilibrium model of pareto inferior trade," Journal of International Economics, Elsevier, vol. 25(1-2), pages 143-154, August.
  7. Pol Antràs, 2003. "Firms, Contracts, and Trade Structure," The Quarterly Journal of Economics, Oxford University Press, vol. 118(4), pages 1375-1418.
  8. David E. Weinstein & Christian Broda, 2004. "Globalization And The Gains From Variety," Econometric Society 2004 Latin American Meetings 327, Econometric Society.
  9. repec:ulb:ulbeco:2013/137536 is not listed on IDEAS
  10. Robert Shimer, 2001. "The Assignment of Workers to Jobs In an Economy with Coordination Frictions," NBER Working Papers 8501, National Bureau of Economic Research, Inc.
  11. Sly, Nicholas, 2012. "Labor matching behavior and trade adjustment," European Economic Review, Elsevier, vol. 56(3), pages 592-604.
  12. Simon Burgess & Carol Propper & Marisa Ratto & StephanievonHinke KesslerScholder & Emma Tominey, 2010. "Smarter Task Assignment or Greater Effort: The Impact of Incentives on Team Performance," Economic Journal, Royal Economic Society, vol. 120(547), pages 968-989, 09.
  13. Paola Conconi & Patrick Legros & Andrew F. Newman, 2008. "Trade Liberalization and Organizational Change," Development Working Papers 262, Centro Studi Luca d'Agliano, University of Milano.
  14. Felbermayr, Gabriel & Prat, Julien, 2007. "Product Market Regulation, Firm Selection and Unemployment," IZA Discussion Papers 2754, Institute for the Study of Labor (IZA).
  15. Fryges, Helmut & Wagner, Joachim, 2007. "Exports and Productivity Growth: First Evidence from a Continuous Treatment Approach," IZA Discussion Papers 2782, Institute for the Study of Labor (IZA).
  16. Dennis Novy, 2011. "Gravity Redux: Measuring International Trade Costs with Panel Data," CESifo Working Paper Series 3616, CESifo Group Munich.
  17. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
  18. Matusz, Steven J, 1996. "International Trade, the Division of Labor, and Unemployment," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(1), pages 71-84, February.
  19. Caliendo, Lorenzo & Rossi-Hansberg, Esteban, 2011. "The Impact of Trade on Organization and Productivity," CEPR Discussion Papers 8535, C.E.P.R. Discussion Papers.
  20. Walter Y. Oi & Todd L. Idson, 1999. "Workers Are More Productive in Large Firms," American Economic Review, American Economic Association, vol. 89(2), pages 104-108, May.
  21. Arnaud Dupuy, 2008. "The Assignment of Workers to Tasks, Wage Distribution, and Technical Change: A Critical Review," Journal of Income Distribution, Journal of Income Distribution, vol. 17(3-4), pages 12-36, September.
  22. Sullivan, Paul, 2010. "Empirical evidence on occupation and industry specific human capital," Labour Economics, Elsevier, vol. 17(3), pages 567-580, June.
  23. Jaime Ortega, 2001. "Job Rotation as a Learning Mechanism," Management Science, INFORMS, vol. 47(10), pages 1361-1370, October.
  24. Danny McGowan & Chris Milner, . "Trade Costs and Trade Composition," Discussion Papers 11/11, University of Nottingham, GEP.
  25. Moritz Ritter, 2015. "Trade and inequality in a directed search model with firm and worker heterogeneity," Canadian Journal of Economics, Canadian Economics Association, vol. 48(5), pages 1902-1916, December.
  26. Michele Pellizzari, 2011. "Employers' Search and the Efficiency of Matching," British Journal of Industrial Relations, London School of Economics, vol. 49(1), pages 25-53, March.
  27. Costas Arkolakis & Sharat Ganapati & Marc-Andreas Muendler, 2016. "The Extensive Margin of Exporting Products: A Firm-level Analysis," Cowles Foundation Discussion Papers 2028, Cowles Foundation for Research in Economics, Yale University.
  28. Davidson, Carl & Matusz, Steven J. & Shevchenko, Andrei, 2008. "Globalization and firm level adjustment with imperfect labor markets," Journal of International Economics, Elsevier, vol. 75(2), pages 295-309, July.
  29. Rasmus Lentz & Dale T. Mortensen, 2010. "Labor Market Models of Worker and Firm Heterogeneity," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 577-602, 09.
  30. Margaret A. Meyer, 1994. "The Dynamics of Learning with Team Production: Implications for Task Assignment," The Quarterly Journal of Economics, Oxford University Press, vol. 109(4), pages 1157-1184.
  31. Li, Fei & Tian, Can, 2013. "Directed search and job rotation," Journal of Economic Theory, Elsevier, vol. 148(3), pages 1268-1281.
  32. Barron, John M & Black, Dan A & Loewenstein, Mark A, 1989. "Job Matching and On-the-Job Training," Journal of Labor Economics, University of Chicago Press, vol. 7(1), pages 1-19, January.
  33. Gene M. Grossman & Elhanan Helpman, 2002. "Integration versus Outsourcing in Industry Equilibrium," The Quarterly Journal of Economics, Oxford University Press, vol. 117(1), pages 85-120.
  34. Ian King & Frank Stahler, 2010. "A Simple Theory of Trade and Unemployment in General Equilibrium," Department of Economics - Working Papers Series 1116, The University of Melbourne.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:bav:wpaper:139_eggerkoch. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rebecca Schrader)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.