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JAQ of All Trades: Job Mismatch, Firm Productivity and Managerial Quality

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Abstract

We develop a novel measure of job-worker allocation quality (JAQ) by exploiting employer-employee data with machine learning techniques. Based on our measure, the quality of job-worker matching correlates positively with individual labor earnings and firm productivity, as well as with market competition, non-family firm status, and employees’ human capital. Management plays a key role in job-worker matching: when managerial hirings and firings persistently raise management quality, the matching of rank-and-file workers to their jobs improves. JAQ can be constructed from any employer-employee data set including workers’ occupations, and used to explore research questions in corporate finance and organization economics.

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  • Coraggio, Luca & Pagano, Marco & Scognamiglio, Annalisa & Tåg, Joacim, 2022. "JAQ of All Trades: Job Mismatch, Firm Productivity and Managerial Quality," Working Paper Series 1427, Research Institute of Industrial Economics, revised 11 Dec 2024.
    • Handle: RePEc:hhs:iuiwop:1427
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    More about this item

    Keywords

    Jobs; Workers; Matching; Mismatch; Machine Learning; Productivity; Management;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management

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