Ownership Networks and Labor Income

Federico Huneeus, Borja Larrain, Mauricio Larrain and Mounu Prem

No weqsz_v1, SocArXiv from Center for Open Science

Abstract: We document a novel relationship between networks of firms linked through ownership (i.e., business groups) and labor income using matched employer-employee data for Chile. Business group affiliation is associated with higher wages, even after controlling for firm size and individual worker effects. The group premium is stronger for top workers; hence, group firms have higher wage dispersion. The premium remains present when comparing group firms and matched stand-alone firms, and in within-firm comparisons using transitions in and out of groups. Our results are consistent with workers reaching higher productivity and wages by leveraging their skills on the group’s organizational structure.

Date: 2022-12-14
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Working Paper: Ownership Networks and Labor Income (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:weqsz_v1

DOI: 10.31219/osf.io/weqsz_v1

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