Anabela Carneiro

Wages and the Risk of Displacement

In this paper a simultaneous-equations model of firm closing and wage determination is specified in order to analyse how wages adjust to unfavorable product demand shocks that raise the risk of displacement through firm closing, and to what extent an exogenous wage change affects the exit likelihood. Using a longitudinal matched worker-firm data set from Portugal, the estimation results suggest that, under the existence of noncompetitive rents, the fear of job loss leads workers to accept wage concessions, even though a compensating differential for the ex ante risk of displacement might exist. A novel result that emerges from this study is that firms with a higher incidence of minimum wage earners are more vulnerable to adverse shocks due to their inability to adjust wages downward. Indeed, minimum wage restrictions were seen to increase the failure rates.

Market power, dismissal threat, and rent sharing: The role of insider and outsider forces in wage bargaining

This study investigates wage determination at the firm level using a longitudinal panel of large firms in Portugal. The results revealed that insider forces such as revenue per employee and market share have a significant impact on wage determination. The results also showed that insider-outsider considerations seem to be empirically relevant in Portugal. That is, firms where insider workers seem to have more market power tend to pay higher wages. More specifically, in firms with low layoff rates, high proportion of permanent employees and high rates of labour utilization workers seem to be in a better position to extract rents in the form of higher wages.

Where Do Spin-Offs Come From? Start-Up Conditions and the Survival of Pushed and Pulled Spin-Offs

Although previous research shows that spin-offs are among the most successful firms in an industry, outperforming de novo entrants, few studies consider the heterogeneity of corporate spin-offs in relation to firm performance or survival. Against this backdrop, the objective of the present chapter is twofold. First, this study aims to add to our knowledge on the relationship between spin-off type and firm survival using a comprehensive matched employer-employee dataset from Portugal. After controlling for their different start-up conditions—namely regarding initial hiring schemes, business-owners’ characteristics, and the industrial and geographical relatedness to the parent firm—and a set of firm, industry, and macroeconomic characteristics, we found no significant survival differences between opportunity and necessity spin-offs. Second, based on the findings, we suggest that necessity spin-offs have not received the attention they deserve. Not only do necessity spin-offs perform an important role in the dynamics of competitive markets, by offering a possible solution for recently displaced individuals, but they also create new jobs and help to prevent the depreciation of workers’ human capital.

Endogeneity in Strategy-Performance Analysis: An Application to Initial Human Capital Strategy and New Venture Performance

Managers engage in a variety of strategies, not randomly, but having in mind their performance implications. Therefore, strategic choices are endogenous in performance equations. Despite increasing efforts by various scholars in solving endogeneity bias, prior attempts have almost exclusively focused on single, one-sided, and discrete (binary) organizational decisions. Yet, in reality, managers often face multiple, simultaneous, and interdependent decisions, possibly including a continuous choice set. These choices may further entail a two-sided process between managers and others, such as employees, strategic partners, customers, or investors, whose choices and preferences also affect the final decision. We discuss how endogeneity can plague the measurement of the performance effects of these two-sided strategic decisions—which are more complex, but more realistic, than prior representations of organizational decision making. We provide an empirical demonstration of possible methods to deal with three different sources of bias, by analyzing the performance effects of two human capital choices made by founders at startup: the size and average quality of the initial workforce.

The Spatial Dimension of Internal Labor Markets

We integrate into a unified framework the spatial and the employment dimensions of worker mobility, tracing workers across firms, across establishments, and across regions. Drawing upon the spatial dimension of internal labor markets in firms with multiple establishments in multiple locations, our results indicate that the contemporaneous wage premium to migration is around 3 percentage points. For the case of job switchers, we find that the return to regional migration is due to access to better jobs at the destination. We also document the existence of an urban premium for same†employer migrants but for employer changes this premium is driven by selection.

Empresas estrangeiras e capital humano nos serviços intensivos em conhecimento

The effect of foreign firms on host economies may occur through labour market, leading to the development of human capital. This paper investigates whether foreign firms contributed in a positive way to the development of human capital, looking in detail at the knowledge intensive services in Portugal. The study is based on panel data at the firm level for the period 2000-2006 using the Quadros de Pessoal dataset. The results show that firms with foreign capital have higher human capital intensity than domestic firms.