Documents Westergaard-Nielsen, Niels 6 results

"In this contribution we examine the interrelation between intra-firm wage increases and firm performance. Previous studies have focused on the dispersion of wages in order to examine for the empirical dominance of positive monetary incentives effects compared to adverse effects due to fairness considerations. We argue that the dispersion of wage increases rather than wage levels is a crucial measure for monetary incentives in firms. The larger the dispersion of wage increases the higher the amount of monetary incentives in firms. In contrast, huge wage inequality without any promotion possibilities does not induce any monetary incentives. Evidence from unique Danish linked employer employee data shows that large dispersion of wage growth within firms is generally connected with low firm performance. The results are mainly driven by white collar rather than blue collar workers."

"Using Danish linked employer–employee data, we find that: (i) exposing the worker to physical hazards leads to a 3 percentage point increase in the probability of voluntary turnover from the average rate of 18%; (ii) working in night shift results in an 11-percentage point hike; and (iii) having an unsupportive boss leads to a 6-percentage point jump. High involvement work practices are found to play a significant role in mitigating the adverse effects of workplace hazards. Finally, the worker under adverse workplace conditions is found to improve the 5-year odds of rectifying such workplace adversities by quitting the firm."

"We study individual job separations and their associated destination states for all individuals in the private sector in Denmark for the period 1980 to 2000, and account for their magnitude and cyclical flows. One finding is that individual and workplace characteristics as well as business cycle effects determine the individual behaviour. In policy simulations the consequences for individual labour market transitions are analysed. We find that structural and growth policies have different consequences for the economy due to the way they change workers' incentives. Policy interventions targeting displaced workers coming from plant closures are argued to be inefficient."

"Previous studies examining intra-firm wage dispersion and firm performance have focused on wage levels. The authors of this study argue that for purposes of comparing wage dispersion's positive incentive effects with its adverse morale effects, the dispersion of wage increases is more revealing than the dispersion of wage levels. It is reasonable to expect greater dispersion of wage increases to be associated with higher monetary incentives, but also with increased perceptions of unfairness. The authors' analysis of linked employer-employee data from Denmark for the years 1992-97 shows that the dispersion of wage growth within firms generally had a negative association with firm performance. The results are mainly driven by white-collar rather than blue-collar workers, perhaps because blue-collar wages are typically regulated by contracts and union rules that explicitly take account of fairness and equity."

"In this paper we will look at job creation and destruction in firms. We will answer the question if it is the large companies that create jobs, while the smaller companies are contributing much less. Or is it the young companies that create jobs? And who destroys the most jobs? In the crisis Denmark lost 186,000 jobs in the private sector. The question is where and how could these jobs be recreated. Are these issues specific to industries or are they universal? The data used is register data on workplaces and firms for the period 1980-2007. The base unit of data is the workplace. The company (firm) is the legal entity. A company can have many sites, and one of the ways companies can grow is by expanding with multiple sites. This can happen by mergers and acquisitions but can also happen by creating "daughter workplaces". It is therefore essential to look at workplaces and firms at the same time. A complication here is that firms switch ID over time because of change of ownership, mergers and divisions. Data must be corrected so that these administrative issues will not affect the survival of firms. The data are used in a way where we can cover firm birth and firm death, spin-offs and mergers. The analysis will make it possible to differentiate between net and gross creation of jobs because we can follow each single individual in and out of jobs. We have for Denmark found that size on its own does not have a big impact, but young firms are much more likely to contribute to a positive growth. For the U.S. it has been found that the growth in jobs comes from small businesses. A closer analysis though shows that the main factor here is the firm age. Thus, it is found that young firms net create the most jobs, but they are also responsible for the most job destructions."