Interlocking Complementarities Between Job Design And Labour Contracts
Luca Cattani (),
Stefano Dughera () and
Fabio Landini ()
Additional contact information
Fabio Landini: University of Turin, http://www.est.unito.it/
Department of Economics and Statistics Cognetti de Martiis. Working Papers from University of Turin
The drivers of large within-industry heterogeneity in the use of non-standard employment are still poorly understood. Specifically, there is little evidence on how firm-specific factors related to the organization of work affect the diversity of hiring decisions. This paper contributes to this line of research by studying the existence of interlocking complementarities between job design and labour contract at the firm level. Using a formal model, we show that firms face two organizational equilibria: one in which job designs with high routine task intensity are matched with a large use of non-standard contracts; and the other in which low routine task intensity combines with a small use of non-standard contracts. These complementarities exist because while non-standard contracts allow firm to adjust to external shocks, they also provide little incentive to invest in firm-specific knowledge. Since the cost associated with the lack of such knowledge is lower (higher) in firms with high (low) routine task intensity, they are also more (less) likely to use this type of contracts. We test the predictions of our model using linked-employer-employee data from the Emilia-Romagna region. We build an index of firm's routine task intensity by matching information from INAPP data at the occupation level. The empirical evidence is consistent with our theory: the use of non-standard contracts is positively associated with routine task intensity at the firm level. This result holds controlling for a wide range of firm-specific and contextual covariates and it is robust to alternative estimation methods (OLS, panel and IV). The related managerial and policy implications are discussed.
Pages: pages 46
New Economics Papers: this item is included in nep-cta, nep-eur and nep-hrm
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
https://www.est.unito.it/do/home.pl/Download?doc=/ ... 21dip/wp_14_2021.pdf (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:uto:dipeco:202114
Access Statistics for this paper
More papers in Department of Economics and Statistics Cognetti de Martiis. Working Papers from University of Turin Contact information at EDIRC.
Bibliographic data for series maintained by Piero Cavaleri () and Marina Grazioli ().