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Working Paper No. 1427

JAQ of All Trades: Job Mismatch, Firm Productivity and Managerial Quality

Working Paper
Reference
Coraggio, Luca, Marco Pagano, Annalisa Scognamiglio and Joacim Tåg (2022). “JAQ of All Trades: Job Mismatch, Firm Productivity and Managerial Quality”. IFN Working Paper No. 1427. Stockholm: Research Institute of Industrial Economics (IFN).

Authors
Luca Coraggio, Marco Pagano, Annalisa Scognamiglio, Joacim Tåg

Does the matching between workers and jobs help explain productivity differentials across firms? To address this question we develop a job-worker allocation quality measure (JAQ) by combining employer-employee administrative data with machine learning techniques. The proposed measure is positively and significantly associated with labor earnings over workers' careers. At firm level, it features a robust positive correlation with firm productivity, and with managerial turnover leading to an improvement in the quality and experience of management. JAQ can be constructed for any employer-employee data including workers' occupations, and used to explore the effect of corporate restructuring on workers' allocation and careers.