Not in my Community: Social Pressure and the Geography of Dismissals

Article dans une revue: We investigate the impact of local social pressure on firms' firing decisions. Using linked employer-employee data, we show that secondary establishments located further away from headquarters have higher dismissal rates than those located closer. The effect of distance on dismissals is stronger, the greater the visibility of the firm in the local community of its headquarters and the larger the degree of selfishness of that community. We show that these findings can be explained by the social pressure exerted by the communities where firms' headquarters are located, which induces CEOs to refrain from dismissing at short distance from their headquarters.

Auteur(s)

Eve Caroli, Giorgio Brunello, Andrea Bassanini

Revue
  • Journal of Labor Economics
Date de publication
  • 2017
Mots-clés JEL
J23 J63 M51 R12
Mots-clés
  • Dismissals
  • Social pressure
Pages
  • 429-483
Version
  • 1
Volume
  • 35