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Wagesize relation and the structure of work-force composition in Italian manufacturing firms

Wagesize relation and the structure of work-force composition in Italian manufacturing firms In this paper we study the impact of firms productivity and scale of activity on the cost of labour for Italian manufacturing firms, investigating how the work-force composition affects the total expenditures for wages. Our analysis reveals that once productivity differences among firms are accounted for, size still retains a positive effect on cost of labour. We show that the source of this phenomenon is the relatively higher proportion of non-production workers in bigger firms, which results in a cost of labour for white collar workers that increases with increasing firm size. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Cambridge Journal of Economics Oxford University Press

Wagesize relation and the structure of work-force composition in Italian manufacturing firms

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References (41)

Publisher
Oxford University Press
Copyright
The Author 2009. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.
ISSN
0309-166X
eISSN
1464-3545
DOI
10.1093/cje/bep046
Publisher site
See Article on Publisher Site

Abstract

In this paper we study the impact of firms productivity and scale of activity on the cost of labour for Italian manufacturing firms, investigating how the work-force composition affects the total expenditures for wages. Our analysis reveals that once productivity differences among firms are accounted for, size still retains a positive effect on cost of labour. We show that the source of this phenomenon is the relatively higher proportion of non-production workers in bigger firms, which results in a cost of labour for white collar workers that increases with increasing firm size.

Journal

Cambridge Journal of EconomicsOxford University Press

Published: Jul 15, 2010

Keywords: Wage–size relation Work force composition Hierarchy theory of the firm Labour productivity

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