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Research Doctorate - Doctor of Philosophy (PhD) / This thesis explores the behaviour of job flows in Taiwan. The investigation of the behaviour of job creation and destruction has improved our understanding of the dynamics of the Taiwanese labour market and also has important implications in terms of economic research and policymaking. Chapter 2 discusses the basic features of the overall post-war Taiwanese economy. We find that large flows of workers enter and exit the employment pool. The large worker flows offer an interesting insight about the job flow dynamics. Based on the measures proposed in Chapter 3, Chapter 4 carefully examines the so-called small business job creation hypothesis. We find that small business can be viewed as the engine of job creation. However, small business is not the source of sustained increases in employment. Chapter 5 documents the basic features of job creation and destruction. We find that job creation is more volatile than job destruction in the manufacturing and service sectors, but reveals the opposite pattern in the construction sector. Based on the methodologies outlined in Chapter 6, Chapter 7 investigates the regime switching and asymmetric behaviour of job creation and destruction. We find that the interest rate can help to explain the asymmetric behaviour of job creation and destruction rates in all sectors. Furthermore, we find an interesting feature that a lower interest rate stimulated beneficial regime shifts in job flows. Chapter 8 explores the similarities and differences of regional business cycles by reference to the employment growth rate as well as job creation and destruction rates. We find that the regime switching behaviour of employment growth was similar across the North, Central and South regions. However, behaviour in the East Region was dramatically different. Furthermore, the regime switching behaviour of the common regional business cycle (specified in terms of employment growth) is consistent with the business cycle indicator proposed by Council for Economic Planning and Development (CEPD).

Essa dissertação analisa como a reestruturação setorial e as privatizações alteraram a dinâmica do fluxo de criação, de destruição e a qualidade dos postos de trabalho no setor telecomunicações brasileiro, no período de 1995 a 2000. A reestruturação do setor de telefonia teve início em 1995 com a introdução da competição no serviço de telefonia móvel. A privatização das empresas de telefonia fixa, longa distância e móvel ocorreu em 1998, finalizando o ciclo de protecionismo na indústria nacional e na busca de auto-suficiência no setor considerado estratégico. A privatização trouxe como resultado um forte aumento na oferta de serviços, revertendo uma década de estagnação no crescimento do setor. O aumento na oferta de serviços das empresas privatizadas foi acompanhado de uma alta taxa de destruição de postos de trabalho com diminuição líquida no emprego e de pequena redução nos salários. Por outro lado, o estabelecimento da concorrência atraiu novas empresas ingressantes para o setor, cujas altas taxas de criação de postos de trabalho permitiram a recuperação do emprego total no setor ao final do período analisado. / This dissertation analyses how restructuring and privatization changed job creation and job destruction flows, as well as job characteristics in Brazilian telecommunications sector from 1995 to 2000. Sector restructuring started in 1995 with competition introduced in the mobile segment. The privatization of state-owned local, long distance and mobile companies occurred in 1998, leading to an end a cycle of nationalist policies of self-sufficiency given the sectors economic, political, and technological importance. Privatization brought strong improvement in the supply of services, reverting a decade of stagnation in service provision. This increase was accompanied by a large drop in net employment driven by a jump in the job destruction rate. On the other hand, competition attracted new entrants, whose high rates of job creation were responsible for leveling the total sector employment back by the end of the studied period.

Essa dissertação analisa como a reestruturação setorial e as privatizações alteraram a dinâmica do fluxo de criação, de destruição e a qualidade dos postos de trabalho no setor telecomunicações brasileiro, no período de 1995 a 2000. A reestruturação do setor de telefonia teve início em 1995 com a introdução da competição no serviço de telefonia móvel. A privatização das empresas de telefonia fixa, longa distância e móvel ocorreu em 1998, finalizando o ciclo de protecionismo na indústria nacional e na busca de auto-suficiência no setor considerado estratégico. A privatização trouxe como resultado um forte aumento na oferta de serviços, revertendo uma década de estagnação no crescimento do setor. O aumento na oferta de serviços das empresas privatizadas foi acompanhado de uma alta taxa de destruição de postos de trabalho com diminuição líquida no emprego e de pequena redução nos salários. Por outro lado, o estabelecimento da concorrência atraiu novas empresas ingressantes para o setor, cujas altas taxas de criação de postos de trabalho permitiram a recuperação do emprego total no setor ao final do período analisado. / This dissertation analyses how restructuring and privatization changed job creation and job destruction flows, as well as job characteristics in Brazilian telecommunications sector from 1995 to 2000. Sector restructuring started in 1995 with competition introduced in the mobile segment. The privatization of state-owned local, long distance and mobile companies occurred in 1998, leading to an end a cycle of nationalist policies of self-sufficiency given the sectors economic, political, and technological importance. Privatization brought strong improvement in the supply of services, reverting a decade of stagnation in service provision. This increase was accompanied by a large drop in net employment driven by a jump in the job destruction rate. On the other hand, competition attracted new entrants, whose high rates of job creation were responsible for leveling the total sector employment back by the end of the studied period.

The main objective of my diploma thesis is to reach the significance of small and medium-sized enterprises and make a statistical analysis of the specific program supporting small and medium-sized enterprises provided by the Czech Moravian Guarantee Bank with the emphasis on the labour market. The analysis indicated that small and medium-sized enterprises are significant players not only in the Czech economy, but also in other states in the world. Small and medium-sized enterprises make 99,23% of the whole business sector in the Czech Republic. They dominate in sectors such as trade, services, fishing, manufacturing and other labour-intensive industries. No less important role small and medium-sized enterprises play in providing jobs, for 59,9% of work force employed in the Czech Republic. Most of empirical studies claim that small and medium-sized enterprises are significant in job creation as well as in job destruction. The certain of jobs in small and medium-sized enterprises are really poor in comparison with the large companies. There are lots of supportive programmes for small and medium-sized enterprises which are concentrated on regional level as well as blanket character. Evaluation of the program supporting small and medium-sized enterprises provided by the Czech Moravian Guarantee Bank confirmed their significance role in job creation and also indicated their small part in job destruction.

The diploma thesis deals with the support analysis of small and medium enterprises (SMEs) in the Czech Republic. The aim of the thesis is to prove the importance of SMEs in the economics and to assess the influence of their support from the Operational Pogramme Enterprise and Innovations (OPEI) on the labour market. The main hypothesis represents the assertion that the SMEs support from the public sources is never effective. The statistical analysis proves that the SMEs in the Czech Republic on the international scale are economically significant. They participate from 99,8% on the total number of entrepreneur's subjects and from almost 60% on the country employment. The evaluation of the support program from the Operational Pogramme Enterprise and Innovations is based on the collected data from the questionnaire poll. The data analysis proved that the supports were important for the workplace production. The public source support analysis on an economical theory and empirical study base proved that the investments are not effective.

This thesis consists of four self-contained studies in empirical labor economics. Micro data on both employers and workers are used to analyze the questions asked in the essays. By using disaggregated information, issues related to firm and individual heterogeneity can be studied.The first essay, The Impact of Temporary Contracts on Gross Job and Worker Flows (with Mahmood Arai), examines job and worker flow dynamics for temporary and permanent contracts. The micro approach to job flows concerns changes in employment at the plant or firm level. Data used in earlier research on gross labor flows do not allow for a distinction between different types of employment contracts (an exception is Abowd et al. (1999). This distinction is especially important in Europe since several European countries discriminate between permanent and temporary contracts in their employment legislation.The data contain quarterly information on the stock of permanent and temporary contracts, as well as direct information on hires and separations for permanent and temporary workers. The information is from a representative sample of around 10,000 Swedish private establishments.The results indicate that temporary contracts, covering only around 10 percent of all contracts, stand for half of all gross job (and worker) flows. This means that gross job (and worker) flow rates for temporary contracts are around 10 times larger than job (and worker) flows for permanent contracts. Our results imply that job reallocation associated with temporary contracts is acyclical in both manufacturing and non-manufacturing sectors. For permanent contracts, job reallocation only exhibits a countercyclical pattern in manufacturing, characterized by a low fraction of temporary contracts. Services employing a higher fraction of temporary contracts exhibit no cyclical pattern in job reallocation, implying that establishments in services use temporary contracts as an adjustment buffer and can adjust its labor input more smoothly.The share of temporary contracts varies with the industry structure and changes as a result of sectoral shifts. This implies that cross-country comparisons, as well as studies of the dynamics of job and worker flows, based on aggregated time-series data, can be distorted by the impact of the fraction of temporary labor on gross labor flows. This, in turn, makes the distinction between permanent and temporary contracts crucial in analyzing job and worker flows, especially when labor protection laws discriminate between short-and long-term employment contracts. The second essay, Wage Dispersion and Allocation of Jobs, investigates the relationship between job turnover and the distribution of wages. One possible explanation for similar labor reallocation rates across labor markets with very different employment-protection legislations is related to differences in wage setting institutions. Bertola and Rogerson (1997) argue that although job-security laws lead to lower job flows, their impact might be reduced if differences in wage-setting institutions have opposite effects. Bertola and Rogerson’s conclusion is that when labor protection laws and wages are jointly considered, the result might very well be that job flows in countries with high adjustment costs and a compressed wage structure mimic those in countries with low adjustment costs and decentralized wages.Using establishment data on job turnover and wages for a panel of around 10,000 establishments in the Swedish private sector, the relationship between wage compression and job reallocation is studied at the industry level.Estimating industry fixed-effects models for 14 two-digit industries yield results indicating large sector differences regarding the effect of the degree of wage dispersion on job reallocation. In accordance with the Bertola and Rogerson hypothesis, this effect is positive in the manufacturing sector. Running separate regressions for job creation and job destruction shows a negative and significant effect of wage dispersion on job destruction, whereas it is insignificant in the job-creation equation. These results are in accordance with wages being more rigid downwards than upwards. The quantitative effect of the impact of wage dispersion on job turnover is limited, however. A one standard deviation increase in wage dispersion reduces the total job reallocation by around 10 percent. Turning to the non-manufacturing sector, the Bertola and Rogerson hypothesis is not supported.Further results include (i) a strong positive effect of the industry-share of temporary employees on job reallocation and (ii) a negative relationship between the use of overtime and job turnover.In the third essay, Wages, Profits and Individual Unemployment Risk: Evidence from Matched Worker-Firm Data (with Mahmood Arai), the impact of firm performance on individual wages is studied. Several studies have found a positive and significant effect of profits on wages. The most widely suggested interpretation for this phenomenon is that employers and employees engage in rent-sharing, thereby splitting the profits created between themselves.The purpose of this study is to examine the extent of rent-sharing and the impact of individual and aggregated unemployment risk on wages of individual workers. We use a sample of over 170,000 Swedish employees for 1991 and 1995 matched with their employing firm’s profits and the unemployment registers. The matched data contain detailed information on individual characteristics, including their unemployment experience during 1992-1995 as well as annual profits as reported in the firms’ balance-sheet reports.The contribution of this paper is that it provides evidence on the wage determination, based on disaggregated individual and firm data dealing with the problems of firm and worker heterogeneity, and the endogeneity of profits. Our results imply positive effects of profits on wages, both in 1991 and 1995. The reported elasticities imply that the wage inequality in Sweden due to the spread in profits is as high as 13% of the mean wages in 1991, according to Lester’s range of pay. These correlations are robust for controlling for time-invariant unobserved individual- and firm characteristics.Using firm-reported short-term product market elasticity and the number of competitors as instruments for profits suggest Lester’s measure of wage inequality due to profits to be as high as 50% of the mean wages.Finally, we investigate the impact of individual heterogeneity with respect to unemployment risk that might also affect wages. We include the individuals’ unemployment event record in our regressions, and our results confirm that individuals with a higher unemployment risk also have lower wages. Including aggregated measures along with individual unemployment risk in our estimations show results suggesting that there exists a robust negative correlation between unemployment risk and wages at various aggregation levels.The final essay, Pay Inequality and Firm Performance: Evidence from Matched Employer-Employee Data, tests several implications from tournament models on the same matched employer-employee data set as in essay 3.According to a variety of theories, the wage distribution both within and between firms can have important effects on individual productivity and firm performance. One argument for high wage differentials, based on incentive effects, is found in Lazear and Rosen’s (1981) tournament theory. Higher wage differentials lead to higher individual effort, and are therefore productivity enhancing. This, in turn, suggests that there is a positive relationship between wage dispersion and productivity. The opposite relationship is found in theories stressing fairness and cooperation between co-workers.For white-collar workers, the results show a positive effect of intra-firm pay spread on firm performance for 1991 and 1995. This applies to different measures of wage dispersion, capturing both raw differences and differences corrected for the fact that part of the wage spread is due to differences in human capital accumulation. To take firm heterogeneity into account, difference equations are estimated on a panel of firms. Once more, consistent with tournament theory, a positive and significant effect of wage dispersion on profits is found. The results for managers are based on information on about 10,000 managers. For various measures of wage dispersion and specifications, a positive and significant association between managerial pay and profits is found. No support is found for the hypothesis of a positive relationship between the number of managers (contestants) and wage spread. Instead, the results show a negative and significant effect of the number of executives and pay spread among managers.Finally, consistent with tournament theory, higher wage dispersion is found in firms operating in volatile product markets characterized by a high degree of output uncertainty. / Diss. Stockholm : Handelshögsk., 2002

Diese Arbeit besteht aus theoretischen und empirischen Beiträgen zur Such- und Matchingliteratur, mit Schwerpunkt auf dem deutschen Arbeitsmarkt. Das erste Kapitel beschreibt das Such- und Matchingmodell des Arbeitsmarktes sowie sein empirisches Gegenstück, den Flussansatz. Das zweite Kapitel zeigt, dass eine Anhebung der Arbeitslosenunterstützung in einem Modell mit skill mismatch und endogener Jobzerstörung zu einer längeren erwarteten Dauer des der Arbeitslosigkeit folgenden Beschäftigungsverhältnisses führt. Andererseits senkt ein Anstieg von skill mismatch in der aggregaten Produktionsfunktion die Arbeitslosenrate. Das dritte Kapitel liefert eine empirische Untersuchung der Arbeiterflüsse der westdeutschen Volkswirtschaft, wobei administrative Mikrodaten verwendet werden. Nach einer Darstellung ihrer Querschnitts- und Zeitreiheneigenschaften wird deren Zyklizität untersucht. Trennungen sind weniger volatil als die Bildung neuer Beschäftigungsverhältnisse, jedoch ist die Zusammensetzung ersterer starken Schwankungen unterworfen. Eine ökonometrische Untersuchung zeigt, dass ein wichtiger Grund für Arbeiterflüsse in die Arbeitslosigkeit während einer Rezession der Rückgang der Einstellungsneigung von Firmen ist, was auch aus dem Rückgang der direkten Job-zu-Job-Übergänge ersichtlich ist. Das vierte Kapitel untersucht die Interaktion zwischen strukturellem Wandel und Arbeitsmarktdynamik. Ein wird gezeigt, dass die Geschwindigkeit der sektoralen Reallokation um das Jahr 1990 in Westdeutschland erheblich und dauerhaft zunahm. Unterschiede im Beschäftigungswachstum zwischen Sektoren lassen sich auf unterschiedliche Zugangsraten (nicht Austrittsraten) zurückführen. Neue Beschäftigungsverhältnisse werden in wachsenden Sektoren vor allem mit Hilfe von Arbeitern aus der Nichterfassung, in schrumpfenden Sektoren auch mit Hilfe von Arbeitslosen, gebildet. Direkte Job-zu-Job-Übergänge spielen bei der sektoralen Reallokation keine Rolle, obwohl sie für die zyklischen Eigenschaften des Arbeitsmarktes äußerst wichtig sind. / This dissertation consists of theoretical and empirical contributions to the literature on search and matching, with a particular focus on the German labour market. The first chapter provides an introduction to the search and matching model of the labour market and its empirical counterpart, the flow approach to labour market dynamics. The second chapter shows that raising unemployment benefits in a model with endogenous job destruction and skill mismatch leads to a longer expected duration of post-unemployment job matches. On the other hand, an increase in skill mismatch in the aggregate production function lowers the level of unemployment in an economy with high unemployment benefits. The third chapter empirically investigates worker flows in the West German economy using administrative micro data. After providing stylised facts on the cross-sectional and the time-series features of gross worker flows, their cyclical properties are investigated. While separations are found to be less volatile than hirings, there are important compositional changes over the business cycle, i.e. the flows underlying separations are relatively volatile. Furthermore, an econometric panel data analysis shows that a major reason for workers becoming unemployed during a recession is a reduction in the hiring activity of firms, which is witnessed by a reduction in direct job-to-job transitions. The fourth chapter uses the same data set in order to examine the interaction between structural change and labour market dynamics. The pace of sectoral reallocation is shown to have permanently accelerated around 1990 in the West German economy. Sectors differ in employment growth rates because of differences in inflow rates, rather than outflow rates. Growing sectors mainly recruit workers from non-participation, while for shrinking sectors, unemployment flows also play an important role. Direct job-to-job transitions, while being crucial for the cyclicality of the labour market, are negligible for sectoral reallocation.

This is a study of innovation in Knowledge Intensive Business Services (KIBS) and the impact innovation has on employment. The thesis relies on theories within the fields of "innovation in services", in particular KIBS, and "innovation and employment", taking as its point of departure the taxonomy of product and process innovation. The thesis is based on a discussion of innovation in services with a focus on how innovation in services may be understood and delineated. A long discussion is dedicated to the taxonomy of product and process innovation and the extent to which these concepts may be applicable to innovation in services. The thesis also scrutinises the concept of KIBS and how this can be defined. It further discusses features commonly associated with KIBS firms. The thesis is also rooted in the broader issue of innovation as a creator and destroyer of employment and makes a contribution in applying these issues to service sectors. The empirical part of the thesis builds on a database compiled for the research project, comprised of 967 Swedish KIBS firms. The database covers issues of innovation, employment and characteristics of the firm. The findings indicate that innovation was common in Swedish KIBS firms and that innovations often had an impact on employment. However, the thesis did not detect a straightforward relation between type of innovation (technological process innovation, organisational process innovation, goods product innovation and service product innovation) and the impact on employment. Explanations other than type of innovation have to be considered to analyse the impact of innovation on employment. The thesis further suggests that although innovation in KIBS is common, innovation itself is difficult to conceptualise and delineate.