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Product Quality and Worker Quality

Author

Listed:
  • John M. Abowd
  • Françis Kramarz
  • Antoine Moreau

Abstract

We study the relation between product quality and worker quality using an economic model that, under certain conditions, provides a direct link between product price, product quality and work force quality. Our measures of product quality are the evolution in the detailed product price relative to its product group and the level of the product price relative to this group. Our worker quality measures are the firm's average person effect and personal characteristics effect from individual wage rates. We find a very weak, generally positive, relation between worker quality and product quality using detailed firm-level data from the French Producer Price Index surveys.

Suggested Citation

  • John M. Abowd & Françis Kramarz & Antoine Moreau, 1996. "Product Quality and Worker Quality," Annals of Economics and Statistics, GENES, issue 41-42, pages 299-322.
  • Handle: RePEc:adr:anecst:y:1996:i:41-42:p:299-322
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    References listed on IDEAS

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    1. John M. Abowd & Bruno Crepon & Francis Kramarz & Alain Trognon, 1995. "A La Recherche des Moments Perdus: Covariance Models for Unbalanced Panels with Endogenous Death," NBER Technical Working Papers 0180, National Bureau of Economic Research, Inc.
    2. Michael Kremer, 1993. "The O-Ring Theory of Economic Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 551-575.
    3. John M. Abowd & Francis Kramarz & David N. Margolis, 1999. "High Wage Workers and High Wage Firms," Econometrica, Econometric Society, vol. 67(2), pages 251-334, March.
    4. Berry, Steven & Levinsohn, James & Pakes, Ariel, 1995. "Automobile Prices in Market Equilibrium," Econometrica, Econometric Society, vol. 63(4), pages 841-890, July.
    5. Robert J. Gordon, 1990. "The Measurement of Durable Goods Prices," NBER Books, National Bureau of Economic Research, Inc, number gord90-1.
    6. Nickell, Stephen & Nicolitsas, D., 1994. "Wages," LSE Research Online Documents on Economics 51644, London School of Economics and Political Science, LSE Library.
    7. Mark Doms & Timothy Dunne & Kenneth R. Troske, 1997. "Workers, Wages, and Technology," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 253-290.
    8. Horst Entorf & Francis Kramarz, 1998. "The Impact Of New Technologies On Wages: Lessons From Matching Panels On Employees And On Their Firms," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 5(2-4), pages 165-198.
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    Cited by:

    1. repec:clu:wpaper:0708-12 is not listed on IDEAS
    2. Stern, David I., 2010. "Energy quality," Ecological Economics, Elsevier, vol. 69(7), pages 1471-1478, May.
    3. Unjung Whang, 2016. "Skilled-Labor Intensity Differences Across Firms, Endogenous Product Quality, and Wage Inequality," Open Economies Review, Springer, vol. 27(2), pages 251-292, April.
    4. repec:eee:labchp:v:3:y:1999:i:pb:p:2629-2710 is not listed on IDEAS
    5. David C. Maré, 2016. "Urban Productivity Estimation with Heterogeneous Prices and Labour," Working Papers 16_21, Motu Economic and Public Policy Research.
    6. Bilanakos, Christos & Heywood, John S. & Sessions, John & Theodoropoulos, Nikolaos, 2018. "Does demand for product quality increase worker training?," Journal of Economic Behavior & Organization, Elsevier, vol. 155(C), pages 159-177.
    7. Maurice Kugler & Eric Verhoogen, 2008. "The Quality-Complementarity Hypothesis: Theory and New Evidence from Colombia," CID Working Papers 183, Center for International Development at Harvard University.
    8. Maurice Kugler & Eric Verhoogen, 2012. "Prices, Plant Size, and Product Quality," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(1), pages 307-339.
    9. Bilanakosa, Christos & Heywood, John S. & Sessions, John & Theodoropoulos, Nikolaos, 2017. "Worker Training and Quality Competition," GLO Discussion Paper Series 137, Global Labor Organization (GLO).
    10. Jean Gabszewicz & Alessandro Turrini, 1999. "Workers' Skills and Product Selection," Revue Économique, Programme National Persée, vol. 50(3), pages 383-391.
    11. Jean-Marie Cardebat, 2002. "Commerce international et développement, quelles relations ? Une réponse empirique à partir de données de panel," Revue Tiers Monde, Programme National Persée, vol. 43(170), pages 423-446.
    12. Christos Bilanakos & John S. Heywood & John Sessions & Nikolaos Theodoropoulos, 2014. "Worker Training and Competing on Product Quality," University of Cyprus Working Papers in Economics 08-2014, University of Cyprus Department of Economics.

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    More about this item

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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