Scandinavian Working Papers in Economics

Lund Papers in Economic History,
Lund University, Department of Economic History

No 136: A Winning Strategy? The employment of women and firm longevity during industrialization

Björn Eriksson () and Maria Stanfors ()
Additional contact information
Björn Eriksson: Department of Economic History, Lund University, Postal: Department of Economic History, Lund University, Box 7083, S-220 07 Lund, Sweden
Maria Stanfors: Department of Economic History, Lund University, Postal: Department of Economic History, Lund University, Box 7083, S-220 07 Lund, Sweden

Abstract: Why do certain firms prosper and grow old while other firms fail? Established knowledge tells us that it is related to the firm’s ability to adapt to market conditions, for example through product diversification, learning-by-doing, and through the adoption of new strategies regarding technology, human resources, and management practices. This paper argues that the employment of women constituted an important competitive advantage for firms in nineteenth-century manufacturing. By using new data covering the entire Swedish tobacco industry, estimating duration models, we find that firms which employed more women were considerably less likely to fail than firms which employed men. The strategy of hiring women in order to reduce costs was a winning strategy among firms in a labor-intensive industry in competitive markets. Thus the adopters of this strategy lived on. The extended longevity of more feminized firms, in turn, reshaped the whole industry. Industry feminization may thus be seen as result of a competitive process in which more feminized firms through longevity came to dominate the industry.

Keywords: Firm survival; longevity; competing risks; competition; female employment

JEL-codes: C41; L10; L66

41 pages, November 26, 2014

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