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

Listed author(s):
  • 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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File URL: http://www.leuphana.de/fileadmin/user_upload/Forschungseinrichtungen/ifvwl/WorkingPapers/wp_232_Upload.pdf
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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
Handle: RePEc:lue:wpaper:232
Contact details of provider: Web page: http://leuphana.de/institute/ivwl.html

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  1. Cardoso, Ana Rute & Guimaraes, Paulo & Varejão, José, 2010. "Are Older Workers Worthy of Their Pay? An Empirical Investigation of Age-Productivity and Age-Wage Nexuses," IZA Discussion Papers 5121, Institute for the Study of Labor (IZA).
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  11. Joachim Wagner, 2010. "Estimated capital stock values for German manufacturing enterprises covered by the cost structure surveys," Working Paper Series in Economics 171, University of Lüneburg, Institute of Economics.
  12. Jin-Tan Liu & Meng-Wen Tsou & Ping Wang, 2010. "Workforce Composition And Firm Productivity: Evidence From Taiwan," Economic Inquiry, Western Economic Association International, vol. 48(4), pages 1032-1047, October.
  13. Benoit Dostie, 2011. "Wages, Productivity and Aging," De Economist, Springer, vol. 159(2), pages 139-158, June.
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  16. Koenker,Roger, 2005. "Quantile Regression," Cambridge Books, Cambridge University Press, number 9780521845731, December.
  17. 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.
  18. Thierry Lallemand & Robert Plasman & François Rycx, 2003. "Intra-firm wage dispersion and fîrm performance: a review and empirical tests on Belgian data," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 46(4), pages 5-30.
  19. Chad Syverson, 2010. "What Determines Productivity?," NBER Working Papers 15712, National Bureau of Economic Research, Inc.
  20. Julia I. Lane & John C. Haltiwanger & James Spletzer, 1999. "Productivity Differences across Employers: The Roles of Employer Size, Age, and Human Capital," American Economic Review, American Economic Association, vol. 89(2), pages 94-98, May.
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  24. repec:spr:weltar:v:144:y:2008:i:4:p:596-635 is not listed on IDEAS
  25. 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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