Agenda

10 Mag 2024 12:15

Andrew Ellul - Entrepreneurs’ Diversification and Labor Income Risk

Sala Partesotti, San Giobbe Economics Campus

Andrew Ellul (Kelley School of Business, Indiana University)

Abstract: Entrepreneurs with better diversified portfolios provide more insurance to employees against labor income risk: in a sample of over 524,000 Canadian firms and 858,000 owners, firms owned by more diversified entrepreneurs offer more stable jobs and earnings to employees when faced by idiosyncratic shocks. A one standard deviation increase in owner’s diversification reduces the shock’s pass-through rate to labor layoffs by 13% and to workers’ earnings by 41%. The data are consistent with such insurance being partly provided to retain valuable human capital and partly to avoid costly terminations. There is no evidence of insurance being priced in average wages.

Lingua

L'evento si terrà in inglese

Organizzatore

Department of Economics (EcSeminars)

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