Caliendo, Lorenzo, Mion, Giordano, Opromolla, Luca David and Rossi-Hansberg, Esteban (2015) Productivity and organization in Portuguese firms. CEP Discussion Paper (1397). London School of Economics and Political Science, CEP, London, UK.
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Abstract
The productivity of firms is, at least partly, determined by a firm's actions and decisions. One of these decisions involves the organization of production in terms of the number of layers of management the firm decides to employ. Using detailed employer-employee matched data and firm production quantity and input data for Portuguese firms, we study the endogenous response of revenue-based and quantity based productivity to a change in layers: a firm reorganization. We show that as a result of an exogenous demand or productivity shock that makes the firm reorganize and add a management layer, quantity based productivity increases by about 4%, while revenue-based productivity drops by more than 4%. Such a reorganization makes the firm more productive, but also increases the quantity produced to an extent that lowers the price charged by the firm and, as a result, its revenue-based productivity.
| Item Type: | Monograph (Discussion Paper) |
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| Official URL: | http://cep.lse.ac.uk/ |
| Additional Information: | © 2015 The Authors |
| Divisions: | Centre for Economic Performance |
| Subjects: | H Social Sciences > HB Economic Theory H Social Sciences > HN Social history and conditions. Social problems. Social reform |
| Date Deposited: | 13 Apr 2016 09:12 |
| Last Modified: | 13 Sep 2024 20:33 |
| Funders: | Economic and Social Research Council |
| URI: | http://eprints.lse.ac.uk/id/eprint/66062 |
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