Brown Bag Economics of Innovation Seminar

Du 03/02/2023 de 10:00 à 11:00

https://insead.zoom.us/j/91768711761?pwd=N214Q3MrRHZBRkdua21OajBaWStUQT09

RUANE Cian (IMF)

Worker Mobility in Production Networks

Abstract: This paper documents that workers tend to find jobs through their employers' production networks. Employer-employee data, matched with the universe of firm-to-firm transactions for the Dominican Republic, reveals that one fifth of workers who change firm move to a buyer or supplier of their original employer - significantly more than predicted by standard labor market characteristics. Hiring from buyers or suppliers accounts for the majority of net job flows to higher wage and productivity firms. An event-study shows that moving to a buyer or supplier results in a persistent 6.7 p.p. increase in earnings relative to other movers. One third of this premium is due to supply chain movers earning more than other workers hired at the same firm. We present evidence that this higher match quality can be explained by human capital transferability along the supply chain. Our results point to a new channel through which factors affecting the supply chain, such as international outsourcing or contracting frictions, affect labor market dynamism.

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