IDEAS home Printed from https://ideas.repec.org/p/zbw/vfsc15/113063.html
   My bibliography  Save this paper

Good Firms, Worker Flows and Local Productivity

Author

Listed:
  • Serafinelli, Michel

Abstract

A consensus has emerged that agglomeration economies are an important factor explaining why firms cluster next to each other. Yet disagreement remains over the sources of these agglomeration effects, given non-trivial measurement challenges. This paper is the first to present direct evidence showing how localized knowledge spillovers arise from workers changing jobs within the same local labor market. Specifically, I as-sess the extent to which firm-to-firm labor mobility enhances the productivity of firms located near highly productive firms, using a unique dataset combining Social Security earnings records and balance sheet information for Veneto, a region of Italy with many successful industrial clusters. I first identify a set of highly productive firms, then show that hiring workers with experience at these firms significantly increases the productivity of other firms. To address identification threats, primarily due to unobservable firm-level productivity shocks correlated with hiring, I use a novel instrumental vari- able strategy, which exploits downsizing events at highly productive firms, in addition to control function methods in the spirit of the productivity literature. My findings from both approaches imply that worker flows can explain around 10 percent of the productivity gains experienced by other firms when new highly productive firms are added to a local labor market.

Suggested Citation

  • Serafinelli, Michel, 2015. "Good Firms, Worker Flows and Local Productivity," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113063, Verein für Socialpolitik / German Economic Association.
  • Handle: RePEc:zbw:vfsc15:113063
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/113063/1/VfS_2015_pid_233.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Ernesto Dal Bó & Frederico Finan & Martín A. Rossi, 2013. "Strengthening State Capabilities: The Role of Financial Incentives in the Call to Public Service," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(3), pages 1169-1218.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kirker, Michael, 2019. "Learning Through Hiring: Knowledge From New Workers as an Explanation of Endogenous Growth," MPRA Paper 94505, University Library of Munich, Germany.
    2. Ascani, Andrea & Gagliardi, Luisa, 2020. "Asymmetric spillover effects from MNE investment," Journal of World Business, Elsevier, vol. 55(6).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Francesco Decarolis & Raymond Fisman & Paolo Pinotti & Silvia Vannutelli, 2019. "Rules, Discretion, and Corruption in Procurement: Evidence from Italian Government Contracting," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-344, Boston University - Department of Economics.
    2. Bas Scheer & Wiljan van den Berge & Maarten Goos & Alan Manning & Anna Salomons, 2022. "Alternative Work Arrangements and Worker Outcomes: Evidence from Payrolling," CPB Discussion Paper 435, CPB Netherlands Bureau for Economic Policy Analysis.
    3. Katherine Casey & Rachel Glennerster & Edward Miguel & Maarten Voors, 2023. "Skill Versus Voice in Local Development," The Review of Economics and Statistics, MIT Press, vol. 105(2), pages 311-326, March.
    4. Girum Abebe & A Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2021. "Anonymity or Distance? Job Search and Labour Market Exclusion in a Growing African City [Endogenous Stratification in Randomized Experiments]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 88(3), pages 1279-1310.
    5. Fuhai Hong & Dong Zhang, 2023. "Bureaucratic beliefs and law enforcement," Public Choice, Springer, vol. 196(3), pages 357-379, September.
    6. David Card & Ana Rute Cardoso & Joerg Heining & Patrick Kline, 2018. "Firms and Labor Market Inequality: Evidence and Some Theory," Journal of Labor Economics, University of Chicago Press, vol. 36(S1), pages 13-70.
    7. Frederico Finan & Maurizio Mazzocco, 2021. "Electoral Incentives and the Allocation of Public Funds," Journal of the European Economic Association, European Economic Association, vol. 19(5), pages 2467-2512.
    8. Guillermo Cruces & Martín A. Rossi & Ernesto Schargrodsky, 2023. "Dishonesty and Public Employment," American Economic Review: Insights, American Economic Association, vol. 5(4), pages 511-526, December.
    9. Barigozzi, Francesca & Parasnis, Jaai & Tani, Massimiliano, 2022. "Gender, Motivation, and Self-Selection into Teaching," IZA Discussion Papers 15532, Institute of Labor Economics (IZA).
    10. Dizon-Ross, Rebecca & Dupas, Pascaline & Robinson, Jonathan, 2017. "Governance and the effectiveness of public health subsidies: Evidence from Ghana, Kenya and Uganda," Journal of Public Economics, Elsevier, vol. 156(C), pages 150-169.
    11. Khemani,Stuti & Chaudhary,Sarang & Scot,Thiago, 2020. "Strengthening Public Health Systems : Policy Ideas from a Governance Perspective," Policy Research Working Paper Series 9220, The World Bank.
    12. Carlo Altavilla & Miguel Boucinha & José-Luis Peydró & Frank Smets, 2019. "Banking Supervision, Monetary Policy and Risk-Taking: Big Data Evidence from 15 Credit Registers," Working Papers 1137, Barcelona School of Economics.
    13. Blumenstock, Joshua & Callen, Michael & Faikina, Anastasiia & Fiorin, Stefano & Ghani, Tarek, 2023. "Strengthening Fragile States: Evidence from Mobile Salary Payments in Afghanistan," CEPR Discussion Papers 18254, C.E.P.R. Discussion Papers.
    14. Andrew Dustan & Stanislao Maldonado & Juan Manuel Hernandez-Agramonte, 2018. "Motivating bureaucrats with non-monetary incentives when state capacity is weak: Evidence from large-scale field experiments in Peru," Working Papers 136, Peruvian Economic Association.
    15. Michèle Belot & Philipp Kircher & Paul Muller, 2022. "How Wage Announcements Affect Job Search—A Field Experiment," American Economic Journal: Macroeconomics, American Economic Association, vol. 14(4), pages 1-67, October.
    16. James Andreoni & Michael Callen & Karrar Hussain & Muhammad Yasir Khan & Charles Sprenger, 2023. "Using Preference Estimates to Customize Incentives: An Application to Polio Vaccination Drives in Pakistan," Journal of the European Economic Association, European Economic Association, vol. 21(4), pages 1428-1477.
    17. Timothy Besley & Maitreesh Ghatak, 2017. "Profit with Purpose? A Theory of Social Enterprise," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 19-58, August.
    18. Juliana Bernhofer & Alessandro Fedele & Mirco Tonin, 2022. "Wage Expectations and Access to Healthcare Occupations: Evidence from an Information Experiment," BEMPS - Bozen Economics & Management Paper Series BEMPS95, Faculty of Economics and Management at the Free University of Bozen.
    19. Arimoto, Yutaka & 有本, 寛 & Kurata, Masamitsu, 2017. "Adoption of Management Practices in the Public Sector of Bangladesh," Discussion Paper Series 654, Institute of Economic Research, Hitotsubashi University.
    20. Oriana Bandiera & Robin Burgess & Erika Deserranno & Ricardo Morel & Munshi Sulaiman & Imran Rasul, 2023. "Social Incentives, Delivery Agents, and the Effectiveness of Development Interventions," Journal of Political Economy Microeconomics, University of Chicago Press, vol. 1(1), pages 162-224.

    More about this item

    JEL classification:

    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:vfsc15:113063. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/vfsocea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.