https://macropaperwarehouse.com/authors/david-thesmar/David ThesmarHugo -- gohugo.ioen-ushttps://macropaperwarehouse.com/papers/the-effects-of-mandatory-profit-sharing-on-workers-and-firms-evidence-from-france/https://macropaperwarehouse.com/papers/the-effects-of-mandatory-profit-sharing-on-workers-and-firms-evidence-from-france/<p>This paper studies the causal effects of mandatory profit-sharing on workers and firms using a quasi-experimental design arising from a 1990 French reform that lowered the eligibility threshold for mandatory profit-sharing from 100 to 50 employees. The institutional setting is the French RSP (Réserve Spéciale de Participation), a profit-sharing scheme in place since 1967 that requires firms above the threshold to distribute a fraction of their excess profits — defined as net income above 5% of book equity — to employees according to a formula scaled by the firm&rsquo;s labor share. For the median firm, this amounts to roughly 10.5% of pre-tax income transferred to workers.</p>