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On the Determinants of Organizational Forgetting

Author

Listed:
  • Guy David
  • Tanguy Brachet
Abstract
Studies of organizational learning and forgetting identify potential channels through which the firm's production experience is lost. These channels have differing implications for efficient resource allocation within the firm, but their relative importance has been ignored to date. We develop a framework for distinguishing the contributions of labor turnover and human capital depreciation to organizational forgetting. We apply our framework to a novel dataset of ambulance companies and their workforce. We find evidence of organizational forgetting, which results from skill decay and turnover effects. The latter has twice the magnitude of the former. (JEL D23, D83, J24, J63)

Suggested Citation

  • Guy David & Tanguy Brachet, 2011. "On the Determinants of Organizational Forgetting," American Economic Journal: Microeconomics, American Economic Association, vol. 3(3), pages 100-123, August.
    • Handle: RePEc:aea:aejmic:v:3:y:2011:i:3:p:100-123
    Note: DOI: 10.1257/mic.3.3.100
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    References listed on IDEAS

    as
    1. Charles D. Bailey, 1989. "Forgetting and the Learning Curve: A Laboratory Study," Management Science, INFORMS, vol. 35(3), pages 340-352, March.
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    More about this item

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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