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Going Public and the Internal Organization of the Firm

Author

Listed:
  • Bias, Daniel

    (Swedish House of Finance at the Stockholm School of Economics)

  • Lochner, Benjamin

    (Institute for Employment Research (IAB), Nuremberg, Germany ; FAU)

  • Obernberger, Stefan

    (Erasmus School of Economics at Erasmus University Rotterdam)

  • Sevilir, Merih

    (Kelley School of Business at Indiana University)

Abstract

"We examine how firms adapt their organization when they go public. To conform with the requirements of public capital markets, we expect IPO firms to become more organized, making the firm more accountable and its human capital more easily replaceable. We find that IPO firms transform into a more hierarchical organization with smaller departments. Hiring is strongest in jobs requiring knowledge in finance, accounting, and management. New hires are better educated, but less experienced than incumbents, which reflects the staffing needs of a more hierarchical organization. Employee turnover is sizeable and directly related to changes in hierarchical layers. Wage inequality increases in public firms as they become more hierarchical. Overall, going public is associated with a comprehensive transformation of the firm’s organization which becomes geared towards operating efficiently and in accordance with capital market standards." (Author's abstract, IAB-Doku) ((en))

Suggested Citation

  • Bias, Daniel & Lochner, Benjamin & Obernberger, Stefan & Sevilir, Merih, 2022. "Going Public and the Internal Organization of the Firm," IAB-Discussion Paper 202214, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    • Handle: RePEc:iab:iabdpa:202214
    DOI: 10.48720/IAB.DP.2214
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    Keywords

    Bundesrepublik Deutschland ; IAB-Open-Access-Publikation ; Börse ; Buchführung ; Fachkenntnisse ; human resource management ; innerbetriebliche Hierarchie ; Kapitalmarkt ; Aktiengesellschaft ; Lohnstruktur ; Organisationsänderung ; Organisationsstruktur ; organisatorischer Wandel ; Personalanpassung ; Personalbedarf ; Personaleinstellung ; Qualifikationsanforderungen ; Qualifikationsbedarf ; Unternehmen ; Unternehmensform ; zusätzliche Arbeitsplätze ; 1984-2015;
    All these keywords.

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General

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