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Wages, Employment, and Capital in Capitalist and Worker-Owned Firms

Author

Listed:
  • Pencavel, John

    () (Stanford University)

  • Pistaferri, Luigi

    () (Stanford University)

  • Schivardi, Fabiano

    () (Bocconi University)

Abstract

Differences in wages, employment, and capital between worker-owned and capitalist enterprises are computed from a matched employer-worker panel data set from Italy, the market economy with the greatest incidence of worker-owned and worker-managed firms. These differences are related to orthodox models of the capitalist firm and worker co-op. The estimates of the wage, employment, and capital equations largely corroborate the implications of the behavioral models of the two types of enterprise. Co-op wages are about 14 percent lower on average and they are more volatile (and employment less volatile) than those in capitalist enterprises. Given the breadth of the data set analyzed, the results can claim to constitute general findings about capitalist and co-op enterprises.

Suggested Citation

  • Pencavel, John & Pistaferri, Luigi & Schivardi, Fabiano, 2006. "Wages, Employment, and Capital in Capitalist and Worker-Owned Firms," IZA Discussion Papers 2188, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp2188
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    References listed on IDEAS

    as
    1. Pencavel, John & Craig, Ben, 1994. "The Empirical Performance of Orthodox Models of the Firm: Conventional Firms and Worker Cooperatives," Journal of Political Economy, University of Chicago Press, vol. 102(4), pages 718-744, August.
    2. Luigi Guiso & Luigi Pistaferri & Fabiano Schivardi, 2005. "Insurance within the Firm," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 1054-1087, October.
    3. Federico Cingano & Fabiano Schivardi, 2004. "Identifying the Sources of Local Productivity Growth," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 720-742, June.
    4. Jones, Derek C & Svejnar, Jan, 1985. "Participation, Profit Sharing, Worker Ownership and Efficiency in Italian Producer Cooperative," Economica, London School of Economics and Political Science, vol. 52(208), pages 449-465, November.
    5. Will Bartlett & John Cable & Saul Estrin & Derek C. Jones & Stephen C. Smith, 1992. "Or-Managed Cooperatives and Private Firms in North Central Italy: An Empirical Comparison," ILR Review, Cornell University, ILR School, vol. 46(1), pages 103-118, October.
    6. Smith, Stephen C., 1994. "Innovation and market strategy in Italian industrial cooperatives: Econometric evidence on organizational comparative advantage," Journal of Economic Behavior & Organization, Elsevier, vol. 23(3), pages 303-320, May.
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    More about this item

    Keywords

    wages; capitalist firms; worker-owned firms; employment; capital;

    JEL classification:

    • J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm

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