Employment and Wage Insurance within Firms: Worldwide Evidence

73 Pages Posted: 23 Jul 2014 Last revised: 9 Nov 2017

See all articles by Andrew Ellul

Andrew Ellul

Indiana University - Kelley School of Business - Department of Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); University of Naples Federico II - CSEF - Center for Studies in Economics and Finance

Marco Pagano

University of Naples Federico II - Department of Economics and Statistics; Centre for Studies in Economics and Finance (CSEF); Einaudi Institute for Economics and Finance (EIEF); Research Institute of Industrial Economics (IFN); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance; Einaudi Institute for Economics and Finance (EIEF); Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 3 versions of this paper

Date Written: September 1, 2017

Abstract

If unemployment insurance is more generous, workers should demand less implicit insurance from their employers: firm- and government-provided insurance should be substitutes. Using a firm-level international panel dataset, we investigate this hypothesis exploiting cross-country and time-series variation in public unemployment insurance as a shifter of workers’ demand for insurance within firms, and family vs. non-family ownership as a shifter of firms’ supply of insurance. We find that employment stability in family firms is greater, and the wage discount larger, in countries with more generous public unemployment insurance, while no such substitutability is present for non-family firms.

Keywords: risk-sharing, insurance, social security, unemployment, wages, family firms

JEL Classification: G31, G32, G38, H25, H26, M40

Suggested Citation

Ellul, Andrew and Pagano, Marco and Schivardi, Fabiano, Employment and Wage Insurance within Firms: Worldwide Evidence (September 1, 2017). Kelley School of Business Research Paper No. 2014-23; European Corporate Governance Institute (ECGI) - Finance Working Paper No. 517/2017. Available at SSRN: https://ssrn.com/abstract=2469461 or http://dx.doi.org/10.2139/ssrn.2469461

Andrew Ellul (Contact Author)

Indiana University - Kelley School of Business - Department of Finance ( email )

1309 E. 10th St.
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Centre for Economic Policy Research (CEPR) ( email )

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European Corporate Governance Institute (ECGI) ( email )

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University of Naples Federico II - CSEF - Center for Studies in Economics and Finance ( email )

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Naples, Naples 80126
Italy

Marco Pagano

University of Naples Federico II - Department of Economics and Statistics ( email )

Via Cintia - Monte S. Angelo
Napoli, 80126
Italy
+39 081 675306 (Phone)
+39 081 7663540 (Fax)

Centre for Studies in Economics and Finance (CSEF) ( email )

Via Cintia
Complesso Monte S. Angelo
Naples, Naples 80126
Italy

Einaudi Institute for Economics and Finance (EIEF)

Via Sallustiana, 62
Rome, 00187
Italy

Research Institute of Industrial Economics (IFN)

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Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

HOME PAGE: http:/www.ecgi.org

Fabiano Schivardi

Luiss Guido Carli - Department of Economics and Finance ( email )

Viale Romania 32
Rome, Rome 00187
Italy

Einaudi Institute for Economics and Finance (EIEF) ( email )

Via Due Macelli, 73
Rome, 00187
Italy

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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