NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Does the Use of Worker Flows Improve the Analysis of Establishment Turnover? Evidence from German Administrative Data

Tanja Hethey-Maier, Johannes F. Schmieder

NBER Working Paper No. 19730
Issued in December 2013
NBER Program(s):   LS   PR

Administrative datasets provide an excellent source for detailed analysis of establishment entries and exits on a fine and disaggregate level. However, administrative datasets are not without problems: restructuring and relabeling of firms is often poorly measured and can create large biases. Information on worker flows between establishments can potentially alleviate these measurement issues, but it is typically hard to judge how well correction algorithms based on this methodology work. This paper evaluates the use of the worker flow methodology using a dataset from Germany, the Establishment History Panel. We first document the extent of misclassification that stems from relying solely on the first and last appearance of the establishment identifier (EID) to identify openings and closings: Only about 35 to 40 percent of new and disappearing EIDs with more than 3 employees are likely to correspond to real establishment entries and exits. We provide 3 pieces of evidence that using a classification system based on worker flows is superior to using EIDs only: First, establishment birth years generated using the worker flow methodology are much higher correlated with establishment birth years from an independent survey. Second, establishment entries and exits which are identified using the worker flow methodology move closely with the business cycle, while events which are identified as simple ID changes are not. Third, new establishment entries are small and show rapid growth, unlike new EIDs that correspond to ID changes.

You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.

Information about Free Papers

You should expect a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.

E-mail:

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w19730

Users who downloaded this paper also downloaded these:
Heal and Park w19725 Feeling the Heat: Temperature, Physiology & the Wealth of Nations
Hanushek, Schwerdt, Wiederhold, and Woessmann w19762 Returns to Skills around the World: Evidence from PIAAC
Bandiera, Prat, and Sadun w19722 Managing the Family Firm: Evidence from CEOs at Work
Davis and von Wachter w17638 Recessions and the Cost of Job Loss
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us