Profitable firms generate employment and pay higher wages

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Title: Profitable firms generate employment and pay higher wages
Author: Vanhala, Juuso ; Virén, Matti
Organization: Bank of Finland
Series: Bank of Finland. Bulletin
Series volume: 91
Series number: 3/2017
Year of publication: 2017
Publication date: 29.6.2017
Pages: 87-105
Subject (yso): kannattavuus; palkat; tuottavuus; työllisyys; yritykset
Keywords: Suomi
Other keywords: companies; firms; employment; Finland; productivity; profitability; wages
Abstract: An economy does not export products or create jobs – firms do. These are, however, very heterogeneous and often far from the average. Only the few 'superstars' of high productivity and profitability stand out distinctively in the large mass. A situation in which a few successful firms deviate strongly from the mass may distort the picture of an average firm and lead to erroneous conclusions about the condition of the corporate sector. However, a characteristic common to all firms is that success is reflected in wages and employment, even if in the export sector, the effect is typically smaller. Economic policy should pay more attention to the considerable heterogeneity of firms.
Note: Economic outlook
Link: http://www.bofbulletin.fi/
Rights: https://helda.helsinki.fi/bof/copyright


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