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Working in family firms: less paid but more secure? Evidence from French matched employer-employee data

Andrea Bassanini (), Eve Caroli (), Antoine Reberioux and Thomas Breda ()

No 2011-38, EconomiX Working Papers from University of Paris Nanterre, EconomiX

Abstract: We study compensation packages in family and non-family firms. Using French matched employer-employee data, we first show that family firms pay on average lower wages. We find that part of this wage gap is due to low wage workers sorting into family firms and high wage workers sorting into non-family firms. However, we also find evidence that company wage policies differ according to ownership status, so that the same worker is paid differently under family and non-family firm ownership. We also find evidence that family firms are characterised by lower job insecurity, as measured by dismissal rates and by the subjective risk of dismissal perceived by workers. In addition, family firms appear to rely less on dismissals – and more on hiring reductions – than non-family firms when they downsize. We show that compensating wage differentials account for a substantial part of the inverse relationship between the family/non-family gaps in wages and job security.

Keywords: family firms; wages; job security; compensating wage differentials; linked employer-employee data (search for similar items in EconPapers)
JEL-codes: G34 J31 J33 J63 L26 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-eur, nep-hrm, nep-lab and nep-lma
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7) Track citations by RSS feed

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Related works:
Working Paper: Working in family firms: less paid but more secure? Evidence from French matched employer-employee data (2011) Downloads
Working Paper: Working in Family Firms: Less Paid but More Secure? Evidence from French Matched Employer-Employee Data (2011) Downloads
Working Paper: Working in family firms: less paid but more secure? Evidence from French matched employer-employee data (2010) Downloads
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