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Working in Family Firms: Paid Less But More Secure? Evidence from French Matched Employer-Employee Data

Author

Listed:
  • Andrea Bassanini

    (ERMES - Equipe de recherche sur les marches, l'emploi et la simulation - UP2 - Université Panthéon-Assas - CNRS - Centre National de la Recherche Scientifique)

  • Thomas Breda

    (CEP - LSE - Centre for Economic Performance - LSE - London School of Economics and Political Science)

  • Eve Caroli

    (PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, LEDa - Laboratoire d'Economie de Dauphine - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres, Legos - Laboratoire d'Economie et de Gestion des Organisations de Santé - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres)

  • Antoine Rebérioux

    (EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

Abstract

The authors study compensation packages in family- and non-family-owned firms. Using French matched employer-employee data, they first find that family firms pay on average lower wages. Part of this wage gap is due to low-wage workers sorting into family firms and high-wage workers sorting into non-family-owned firms; however, they also find evidence that company wage policies differ according to ownership status, so that the same worker is paid differently under family and non-family firm ownership. In addition, family firms are characterized by lower job insecurity, as measured by lower dismissal rates. Family firms appear to rely less on dismissals, and more on hiring reductions, than do non-family-owned firms when they downsize. Compensating wage differentials account for a substantial part of the inverse relationship between the family/non-family gaps in wages and job security.

Suggested Citation

  • Andrea Bassanini & Thomas Breda & Eve Caroli & Antoine Rebérioux, 2013. "Working in Family Firms: Paid Less But More Secure? Evidence from French Matched Employer-Employee Data," Post-Print halshs-00832786, HAL.
    • Handle: RePEc:hal:journl:halshs-00832786
    DOI: 10.1177/00197939130660020
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