# **2 Data and Descriptive Statistics**

This paper is based on a unique firm-level data set that resulted from merging three different sources of information in Brazil: 1) the _Rela ̧c ̃oes Anual de Informa ̧c ̃oes Sociais_ (RAIS), a linked employer-employee data set from the Brazilian Ministry of Labor;<sup>7</sup> 2) the SECEX/MDIC data set, which provides firms’ exporting status and 3) the Peiex data, identifying the firms that received assistance from Peiex.<sup>8</sup> The database was merged using a unique identifier at the firm level.<sup>9</sup> It covers the period between 2006 to 2010. We focused on manufacturing firms and adopted the sectoral definition of CNAE 2.0 (Portuguese acronym for National Economic Activity Classification) that is equivalent to the International Standard Industrial Classification of All Economic Activities (ISIC, Rev.4.).<sup>10</sup> Also, given that for the analysis we need information on firms for at least two subsequent years, we kept firms that are in RAIS for at least 2 years.<sup>11</sup> We measure firms’ organization following Caliendo et al. (2012) and Helpman et al. (2012) to classify the number of layers. We use the _Classifica ̧c ̃ao Brasileira de Ocupa ̧c ̃ao_ (CBO) definition of occupation, which is composed by 9 different categories according to similar level of authority and/or competencies.<sup>12</sup> Table 1 describes the original categories and the way we aggregated them for the analysis. This classification was used to define the number of “knowledge-based” layers in each firm. If a firm has employees belonging to only one of these categories (e.g. blue collars), this firm will have no layers of knowledge. If there are employees in two of these categories (e.g. blue collars and senior staff), this firm will have one layer of knowledge-based hierarchy. We provide further details on the proxy for hierarchy in the appendix (section 6.2).

|**Classifcation**|**CBO**<sup>(</sup><sup>_a_)</sup>|**Occupation**|**Level**<sup>(</sup><sup>_b_)</sup>|
|---|---|---|---|
|CEOs, Directors, Managers|CG 1|CEOs, Directors and Managers|-|
|Professionals|CG 2|Art and Sciences - high level of experience|4|
|Technicians (middle-level)|CG 3|Quality control, technical, accounting|3|
|Clerks|CG 4|White color - internal administration services|2|
||CG 5|White color -external administration services|2|
|Blue collars|CG 7 and CG 8|Welders, assemblers, machine operators|2|
||CG 9|Maintanance workers|2|

Table 1: CBO classification Note: (a) CG 6 refers to agriculture and it was excluded; (b) Level of competency according to CBO.

> 7RAIS is a register of all formal firms in Brazil. It provides information about the size of the establishment, geographic distribution and workers, such as wage, education, age and gender.

> 8 _Secretaria de Com ́ercio Exterior_ (SECEX) from the Ministry of Development, Industry and Trade (MIDC). A list of exporting firms by year is publicly available on www.mdic.gov.br.

> 9The information of the treatment is available at the firm level. Nonetheless, in Peiex’s cases, the majority of treated firms are relatively small with a unique plant.

> 10The Peiex program targets manufacturing firms. We used CNAE 2.0, 2 digits, from 10 to 33, which defines manufacturing.

> 11For some of the estimations, it was necessary information from firms with two lags. Then, it was kept firms that are in RAIS in at least three subsequent periods ( _t-2_ , _t-1_ and _t_ ).

> 12The concept of competence adopted by CBO has two dimensions: (1) It is a function of the complexity, scope and responsibility of activities in employment or another working relationship; (2) It is related to the characteristics of the work context as an area of knowledge, function, economic activity and production process.

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