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Age and gender composition of the workforce, productivity and profits: Evidence from a new type of data for German enterprises

  • Christian Pfeifer

    ()

    (Leuphana University Lueneburg, Germany)

  • Joachim Wagner

    ()

    (Leuphana University Lüneburg, Germany)

This empirical paper documents the relationship between composition of a firm's workforce (with a special focus on age and gender) and its performance (productivity and profitability) for a large representative sample of enterprises from manufacturing industries in Germany. We use unique newly available data that for the first time combine information from the statistics of employees covered by social security that is aggregated at the enterprise level and information from enterprise level surveys performed by the Statistical Offices. Our microeconometric analysis confirms previous findings of concave age-productivity profiles, which are consistent with human capital theory, and adds a new finding of a rather negative effect of age on firms' profitability, which is consistent with deferred compensation considerations. Moreover, our analysis reveals for the first time that the ceteris paribus lower level of productivity in firms with a higher share of female employees does not go hand in hand with a lower level of profitability in these firms. If anything, profitability is (slightly) higher in firms with a larger share of female employees. This finding might indicate that lower productivity of women is (over)compensated by lower wage costs for women, which might be driven by general labor market discrimination against women.

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Paper provided by University of Lüneburg, Institute of Economics in its series Working Paper Series in Economics with number 232.

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Length: 41 pages
Date of creation: Feb 2012
Date of revision:
Handle: RePEc:lue:wpaper:232
Contact details of provider: Web page: http://leuphana.de/institute/ivwl.html

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  1. The International Study Group on Exports and Productivity, 2007. "Exports and productivity - comparable evidence for 14 countries," Policy Research Working Paper Series 4418, The World Bank.
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  3. Alessandra Cataldi & Stephan Kampelmann & François Rycx, 2011. "Productivity-Wage Gaps Among Age Groups: Does the ICT Environment Matter?," De Economist, Springer, vol. 159(2), pages 193-221, June.
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  17. Holger Alda & Stefan Bender & Hermann Gartner, 2005. "European Data Watch: The linked employer-employee dataset created from the IAB establishment panel and the process-produced data of the IAB (LIAB)," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 125(2), pages 327-336.
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  25. David Roodman, 2006. "How to Do xtabond2: An Introduction to "Difference" and "System" GMM in Stata," Working Papers 103, Center for Global Development.
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