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

Author

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  • Andrea Bassanini

    () (ERMES - Equipe de recherche sur les marches, l'emploi et la simulation - UP2 - Université Panthéon-Assas - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche - CNRS - Centre National de la Recherche Scientifique)

  • Thomas Breda

    (CEP - Centre for Economic Performance - LSE)

  • Eve Caroli

    () (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics, LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine, Legos - Laboratoire d'Economie et de Gestion des Organisations de Santé - Université Paris-Dauphine)

  • Antoine Rebérioux

    () (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," PSE - Labex "OSE-Ouvrir la Science Economique" halshs-00832786, HAL.
  • Handle: RePEc:hal:pseose:halshs-00832786 Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00832786
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    References listed on IDEAS

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    8. Deininger, Klaus & Feder, Gershon, 2001. "Land institutions and land markets," Handbook of Agricultural Economics,in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 1, chapter 6, pages 288-331 Elsevier.
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    Cited by:

    1. Andrew Ellul & Marco Pagano & Fabiano Schivardi, 2014. "Employment and Wage Insurance within Firms - Worldwide Evidence," EIEF Working Papers Series 1402, Einaudi Institute for Economics and Finance (EIEF), revised Sep 2017.
    2. repec:kap:sbusec:v:50:y:2018:i:1:d:10.1007_s11187-017-9884-4 is not listed on IDEAS
    3. repec:krk:eberjl:v:5:y:2017:i:2:p:177-193 is not listed on IDEAS
    4. repec:kap:jbuset:v:146:y:2017:i:3:d:10.1007_s10551-015-2937-1 is not listed on IDEAS
    5. Bjuggren, Carl Magnus, 2015. "Sensitivity to shocks and implicit employment protection in family firms," Journal of Economic Behavior & Organization, Elsevier, vol. 119(C), pages 18-31.
    6. repec:krk:eberjl:v:5:y:2017:i:2:p:159-176 is not listed on IDEAS
    7. Block, Jörn H. & Fisch, Christian O. & Lau, James & Obschonka, Martin & Presse, André, 2016. "Who prefers working in family firms? An exploratory study of individuals’ organizational preferences across 40 countries," Journal of Family Business Strategy, Elsevier, vol. 7(2), pages 65-74.

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