Julián Messina

When productivity goes up, firms raise salaries

Corporate building, by groar, under a CC0 licence
Firms are important for workers’ wages. This blog post investigates the extent to which differences in firms’ pay are related to differences in firms’ physical productivity. Based on matched employer-employee data from Sweden, it finds that firms that benefit from positive productivity shocks increase wages of incumbent workers. The impact is larger if […]

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    The unintended consequences of an Italian labour protection law

The unintended consequences of an Italian labour protection law

View of the Streets of Rome From Piazza di Spagna (cropped), by edwin.11, under a CC-BY-2.o licence
Legislation aimed at protecting employees can damage firms’ productivity, according to our research. Our study of the effects of a law in Italy that raised the cost to small businesses of dismissing staff finds that these firms increased their capital stock but that their […]