Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/242374 
Year of Publication: 
2021
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2021: Climate Economics
Publisher: 
ZBW - Leibniz Information Centre for Economics, Kiel, Hamburg
Abstract: 
We merge firm-level data on ownership linkages with administrative data on German workers to analyze how the position in a business group hierarchy affects workers' wages. To acknowledge that ownership linkages are not onedirectional, we propose an index to measure hierarchical distance to the ultimate owner. After controlling for unobserved heterogeneity and selection into the business group hierarchy, we find a positive effect of larger hierarchical distance to the ultimate owner of a business group on workers' wages. This result is in line with a monitoring-based theory of business group hierarchies, in which larger hierarchical distance to the ultimate owner is associated with lower monitoring efficiency and thus higher wage payments to incentivize workers
Subjects: 
Business groups
ownership networks
workers wages
differencein-difference
hierarchical distance
JEL: 
C23
J31
L23
Document Type: 
Conference Paper

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