Plausibly Exogenous [1274] - Profit Sharing (07/29/2023)
LHS Variable
Labor and profit share
RHS Variable
Mandatory profit-sharing by firms
Source of Exogenous Variation
Since 1967, all French firms with more than 100 employees are required to share a fraction of their excess-profits with their employees. Through this scheme, firms with excess-profits distribute on average 10.5% of their pre-tax income to workers. In 1990, the eligibility threshold was reduced to 50 employees.
- Nimier-David, Sraer, and Thesmar (2023), “The Effects of Mandatory Profit-Sharing on Workers and Firms: Evidence from France”