Wages, Employment, and Capital in Capitalist and Worker-Owned Firms
John H. Pencavel
Stanford Institute for Economic Policy Research (SIEPR); Institute for the Study of Labor (IZA)
Stanford University; Centre for Economic Policy Research (CEPR)
Bank of Italy - Research Department
October 1, 2006
Industrial and Labor Relations Review, Vol. 60, No. 1, 2006
The authors investigate how worker-owned and capitalist enterprises differ with respect to wages, employment, and capital in Italy, the market economy with the greatest incidence of worker-owned and worker-managed firms. Estimates calculated using a matched employer-worker panel data set for the years 1982-94 largely corroborate the implications of orthodox behavioral models of the two types of enterprise. Co-ops had 14% lower wages than capitalist enterprises, on average; more volatile wages; and less volatile employment. Given the quality of the data set analyzed, the authors argue, these results can be regarded as having broad generality.
Keywords: Capitalist and Worker-Owned Firms
JEL Classification: J30, J54Accepted Paper Series
Date posted: May 14, 2011
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