Skill Dispersion and Firm Productivity: An Analysis with Employer-Employee Matched Data

Fabiano Schivardi, Susana Iranzo and Elisa Tosetti

No 5539, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We study the relation between workers' skill dispersion and firm productivity using a unique dataset of Italian manufacturing firms from the early eighties to the late nineties with individual records on all their workers. Our measure of skill is the individual worker's effect obtained as a latent variable from a wage equation. Estimates of a generalized CES production function that depends on the skill composition show that a firm's productivity is positively related to skill dispersion within occupational status groups (production and non-production workers) and negatively related to skill dispersion between these groups. Consistently, the variance decomposition shows that most of the overall skill dispersion is within and not between firms. We find no change over time in the share of each component, in contrast with some evidence from other countries, based on less comprehensive data.

Keywords: Matched data; Skills; Productivity; Segregation (search for similar items in EconPapers)
JEL-codes: D24 J24 L23 (search for similar items in EconPapers)
Date: 2006-03
New Economics Papers: this item is included in nep-bec, nep-eff, nep-hrm and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Related works:
Journal Article: Skill Dispersion and Firm Productivity: An Analysis with Employer-Employee Matched Data (2008)
Working Paper: Skill dispersion and firm productivity; an analysis with employer-employee matched data (2006)
Working Paper: Skill dispersion and firm productivity: an analysis with employer-employee matched data (2006)
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