nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2013‒08‒05
fifteen papers chosen by
Tommaso Reggiani
University of Cologne

  1. Has Education Paid Off for Black Workers? By John Schmitt; Janelle Jones
  2. Employee Engagement – A Key to Organizational Success in 21st Century By Bindiya S. Soni
  3. HUMAN CAPITAL LOSS IN CORPORATE BANKRUPTCY By John R. Graham; Hyunseob Kim; Si Li; Jiaping Qiu
  4. Productivity and age: Evidence from work teams at the assembly line By Weiss M.; Börsch-Supan A.
  5. A Study on Employees’ Perception towards Compensation Management System in Selected Branches of SBI of Ujjain District By Harish Shukla; Shweta Tiwari
  6. The Impact of Within and Between Occupational Inequalities on People's Justice Perceptions towards Their Own Earnings By Carsten Sauer; Peter Valet; Stefan Liebig
  7. Teachers Training and Professional Competencies By A.K. Kulshrestha; Kshama Pandey
  8. The impact of taxation on international assignment decisions: A principal-agent approach By Martini, Jan Thomas; Niemann, Rainer
  9. Anatomy of Human Resources in Reserve Bank of India (RBI) By M.M.Goel; Archna Chaudhry
  10. Moonlighting Politicians: Motivation Matters! By Fedele, Alessandro; Naticchioni, Paolo
  11. Racial and Ethnic Differences in Nonwage Compensation By Ritter, Joseph A.
  12. Daily Needs, Income Targets and Labor Supply: Evidence from Kenya By Pascaline Dupas; Jonathan Robinson
  13. The sources of wage variation: a three-way high-dimensional fixed effects regression model By Sónia Torres; Pedro Portugal; John T. Addison; Paulo Guimarães
  14. Positive Effects of Ageing and Age-Diversity in Innovative Companies Ð Large Scale Evidence on Company Productivity By Uschi Backes-Gellner; Stephan Veen
  15. Unethical Culture, Suspect CEOs and Corporate Misbehavior By Lee Biggerstaff; David C. Cicero; Andy Puckett

  1. By: John Schmitt; Janelle Jones
    Abstract: Over the past three decades, the “human capital” of the employed black workforce has increased enormously. In 1979, only one-in-ten (10.4 percent) black workers had a four-year college degree or more. By 2011, more than one in four (26.2 percent) had a college education or more. Over the same period, the share of black workers with less than a high school degree fell from almost one-third (31.6 percent) to only about one in 20 (5.3 percent). The black workforce has also grown considerably older. In 1979, the median employed black worker was 33 years old; today, the median is 39. Economists expect that increases in education and work experience will increase workers' productivity and translate into higher compensation. But, the share of black workers in a “good job” – one that pays at least $19 per hour (in inflation-adjusted 2011 dollars), has employer-provided health insurance, and an employer-sponsored retirement plan – has actually declined. This paper looks at this trend and policies that would have a large, positive impact on the quality of jobs for black workers.
    Keywords: black workers, good jobs, retirement, pensions, health insurance, wages, labor, education, bad jobs, gender, pay equity
    JEL: J J3 J31 J32 J38 J5 J1 J11 J15 I I2 I24 I25
    Date: 2013–06
  2. By: Bindiya S. Soni
    Abstract: Employee engagement is the level of commitment and involvement an employee has towards their organization and its values. An engaged employee is aware of business context, and works with colleagues to improve performance within the job for the benefit of the organization. It is a positive attitude held by the employees towards the organization and its values. The paper focuses on how employee engagement is an antecedent of job involvement and what Manager or Boss should do to make the employees engaged. The paper also looks at the Gallup 12 point questionnaire, twelve-question survey that identifies strong feelings of employee engagement and the steps which shows how to drive an engaged employee. This paper also tries to identify the key drivers of 'Employee Engagement', its different attributes together with the ways to measure it, how to handle disengaged employees and modern 'Employee Engagement' practices in corporate. Findings from various researches and surveys are used in the present work to measure the effect of 'Employee Engagement' which includes issues like productivity, profitability, focus on customer and various other related matters. Key words: employee, employee engagement, organisational success
    Date: 2013–03
  3. By: John R. Graham; Hyunseob Kim; Si Li; Jiaping Qiu
    Abstract: This paper quantifies the “human costs of bankruptcy” by estimating employee wage losses induced by the bankruptcy filing of employers using employee-employer matched data from the U.S. Census Bureau’s LEHD program. We find that employee wages begin to deteriorate one year prior to bankruptcy. One year after bankruptcy, the magnitude of the decline in annual wages is 30% of pre-bankruptcy wages. The decrease in wages persists (at least) for five years post-bankruptcy. The present value of wage losses summed up to five years after bankruptcy amounts to 29-49% of the average pre-bankruptcy market value of firm. Furthermore, we find that the ex-ante wage premium to compensate for the ex-post wage loss due to bankruptcy can be of similar magnitude with that of the tax benefits of debt.
    Keywords: Bankruptcy; Costs of financial distress; Human capital; Wage loss; Capital structure
    JEL: G3 G32 G33 J24 J31 J33
    Date: 2013–07
  4. By: Weiss M.; Börsch-Supan A. (ROA)
    Abstract: We study the relation between workers age and their productivity in work teams, based on a new and unique data set that combines data on errors occurring in the production process of a large car manufacturer with detailed information on the personal characteristics of workers related to the errors. We correct for non-random sample selection and the potential endogeneity of the age-composition in work teams. Our results suggest that productivity in this plant which is typical for large-scale manufacturing does not decline at least up to age 60.
    Keywords: Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity; Economics of the Elderly; Economics of the Handicapped; Non-labor Market Discrimination; Human Capital; Skills; Occupational Choice; Labor Productivity;
    JEL: D24 J14 J24
    Date: 2013
  5. By: Harish Shukla; Shweta Tiwari
    Abstract: Employee satisfaction is one of the most important aspects in the organization that cannot be ensured without proper compensation management system. The present work is based on the study of Compensation Management System in selected branches of SBI. SBI being the largest nationalized bank needs strong compensation management systems so that it can achieve rapid growth at national as well as international level. The study aims at knowing whether current compensation policy is able to attract, retain & motivate employees or not, whether it is effective, whether the present employees are satisfied with current compensation policy or not, whether quality compensation policy is being maintained in SBI or not. Most of the employees feel that the present compensation policy is able to attract, retain and motivate employees. It is found that overall employee satisfaction with the current compensation policy of the bank is low. Psychological and self-actualization needs of employees are not satisfied properly. It is found that most of the employees feel that there is no match between individual objectives and objectives of compensation of bank. 35% employees are not satisfied with the quality of compensation policies. There is a proper Job Evaluation Plan at workplace and also employees feel satisfaction with current methods of compensation. There is effective audit procedure to check effectiveness of compensation policies. Staff in Bank is aware of the importance & needs for effective compensation policy. It is found that needs for compensating employees are not identified on the basis of market trend and competition. Key words: Employees’ Perception, Compensation Management System, SBI
    Date: 2013–06
  6. By: Carsten Sauer; Peter Valet; Stefan Liebig
    Abstract: This paper investigates justice perceptions of employees towards their own earnings. Earnings are decomposed into three components: (1) In returns based on human capital endowments, (2) in returns based on individual residual differences and (3) in returns based on differences between occupations. The legitimacy of these earnings components is measured via the justice assessments of employees. Based on theoretical models from justice research and class theory it is hypothesized that earnings inequality resulting from human capital factors is evaluated as just, whereas residual inequality and occupational inequality are perceived as unjust. The hypotheses are tested by using data from a German longitudinal panel study (SOEP) of the years 2005 to 2011. These data allow studying changes of individual earnings and justice evaluations in a household panel over the time span of six years (with four biennial measurement points). The findings support our hypotheses indicating that losses or gains in earnings which are due to changes in human capital endowments do not affect justice perceptions of own earnings. Losses or gains stemming from changes of a person's earnings position within the occupational group or the position of a person's occupational group within the earnings hierarchy of a society, however, affect justice perceptions remarkably. Thus, we can show that justice evaluations of own earnings do not solely depend on compensation for individual investments but also on residual differences in earnings within and between occupational groups.
    Keywords: Earnings inequality, fairness of earnings, decomposition of justice evaluations, group identification, panel regression
    Date: 2013
  7. By: A.K. Kulshrestha; Kshama Pandey
    Abstract: Education is the ability to meet life’s situation, it is a character building process, enhancing one’s personality and making him/her rational, capable, responsive and intelligent. Competency standards are concerned with application of professional knowledge and skills within the workplace and are underpinned by teachers’ professional values. Competence is usually associated with highly professional performance and there is a direct link in the field of education between a teacher’s professional competence and pupil performance. The paper discusses teacher training and professional competencies and suggests the measures for enhancement and development. Key words: Teacher training, professional competency, teaching-learning
    Date: 2013–03
  8. By: Martini, Jan Thomas; Niemann, Rainer
    Abstract: In many industries like management consulting, IT consulting, or construction highly qualified employees, i.e., experts or executive managers, have to be assigned to temporary projects. In firms with many employees and various different projects, this assignment decision involves a complex optimization procedure. Obviously, the employees' productivities in the respective projects are crucial for the employer's optimal assignment decision, but assignment can also be affected by risk-incentive trade-offs. Moreover, taxation can alter the assignment decision, especially if employees are sent abroad as expatriates so that international tax law has to be taken into account. To address these issues simultaneously, we combine a human resource assignment problem with a principal-agent problem of the LEN type. Both wage taxation at the agents' level and corporate taxation at the principal's level are integrated. We show that national tax rules aswell as the methods for avoiding double taxation and the agents' tax characteristics are important determinants for international assignment decisions. The effects of tax rate variations can be ambiguous and depend on whether the exemption method or the credit method are applied, in particular if agents make differing choices of residence. From a tax policy perspective, the exemption method should be preferred because the tax effects are more transparent than under the credit method. Special deductions for incoming expatriates have only little effects on the optimal assignment decision. --
    Keywords: Assignment,Expatriates,International taxation,Principal-agent model,LEN model
    JEL: H24 H25 M41
    Date: 2013
  9. By: M.M.Goel; Archna Chaudhry
    Abstract: The Reserve Bank of India (RBI) has the responsibility of handling assorted functions ranging from monetary policy, maintaining financial stability to regulating and supervising banks and non-banking financial companies. The quality of governance by RBI as banker’s bank for the delivery of multi-dimensional tasks professionally, human resource development (HRD) and organization management is crucial. It is a established reality that human resources at RBI handled global financial crisis competently but there is a news that RBI has hired services of six external agencies to suggest measures for improving their quality meaning there by we need to do more on HRD as aspects in RBI. Therefore, there is a strong case for analyzing the strengths and weaknesses of human resources in RBI for future growth. We have analyzed the quantity and quality of human resources at the RBI including organizational structure whose quality plays vital role for good governance. Then we have highlighted current status as well as the structure of human resource at the RBI keeping in view its composition on various bases like departments, classes and categories and observed that it is a fair practice, gender sensitive and equal opportunity institution but at the same time suggested to explore the synergies of new department of HRM after combining the DAPM and HRDD. Key words: RBI, HRM, HRD , Good Governance as SMART & SIMPLE
    Date: 2013–06
  10. By: Fedele, Alessandro (Free University of Bozen/Bolzano); Naticchioni, Paolo (University of Cassino)
    Abstract: In this paper we study optimal choices of self-selection into politics and commitment once in office on the part of citizens with heterogeneous abilities and heterogeneous motivations. Politicians can moonlight, i.e., they can work in the market sector while appointed in parliament. Our theoretical framework shows that high-ability citizens may enter politics. Yet while high-ability non-motivated (market-fit) politicians are likely to shirk, high-ability motivated (public-fit) ones are more committed to parliamentary activity. We test our predictions by using a unique database of Italian parliamentarians for the period 1996-2006. We find evidence of advantageous selection of the market-fit and the public-fit politicians in that they both display a pre-election income greater than that of the Italian population. We also show that the commitment of the market-fit parliamentarians in terms of voting attendance is negatively affected by income opportunities, whilst this is not the case for the public-fit ones.
    Keywords: motivation, moonlighting politicians
    JEL: P16 J45 J24 J32
    Date: 2013–07
  11. By: Ritter, Joseph A.
    Abstract: Previous research has found that, after controlling for test scores, measured black-white wage gaps are small but unemployment gaps remain large. This paper complements this previous research by examining the incidence of employer-provided benefits from the same premarket perspective. However, marriage rates differ substantially by race, and the possibility of health-insurance coverage through a spouse’s employer therefore distorts how the distribution of benefits available in the market to an individual is expressed in the distribution of benefits received. Two imputation strategies are used to address this complication. The evidence suggests that benefit availability gaps are small.
    Keywords: Labor and Human Capital, Public Economics,
    Date: 2013–06
  12. By: Pascaline Dupas; Jonathan Robinson
    Abstract: Many studies suggest that daily income earners behave as if they have daily income targets. Less work has examined the determinants of the targets themselves. Using data on labor supply, shocks, and self-reported cash needs from 257 bicycle taxi drivers in Western Kenya, we provide evidence that many individuals treat their daily cash need as the day's target. We conjecture that in a physically demanding job, workers may have an incentive to quit early and so set a personal rule of “earning enough for the day's need” as an internal commitment device to provide effort. This heuristic is more common among less educated workers and has substantial welfare costs: greater variance in hours worked is associated with worse health, and we estimate that workers would earn 5% more by working a set number of hours each day (more if their wage elasticity were positive).
    JEL: C93 D12 J22
    Date: 2013–07
  13. By: Sónia Torres; Pedro Portugal; John T. Addison; Paulo Guimarães
    Abstract: This paper estimates a wage equation with three high-dimensional fixed effects, using a longitudinal matched employer-employee dataset covering virtually all Portuguese wage earners over a little more than two decades. The variation in log real hourly wages is decomposed into different components related to worker, firm, and job title characteristics (both observed and unobserved) and a residual component. It is found that worker permanent heterogeneity is the most important source of wage variation (36.0 percent) and that the unobserved component plays a more important role (21.0 percent) than the observed component (15.0 percent) in explaining wage differentials. Firm permanent effects are less important overall (28.7 percent) and are due in almost equal parts to the unobserved component and the observed component. Job title effects emerge as the least important dimension but they still explain close to 10 percent of wage variation. Equally important, we found definitive evidence of positive assortative matching.
    JEL: J2 J41
    Date: 2013
  14. By: Uschi Backes-Gellner (Department of Business Administration, University of Zurich); Stephan Veen (Disney Research Zurich)
    Abstract: This paper investigates how age diversity within a companyÕs workforce affects company productivity. It introduces a theoretical framework that helps to integrate results from a broad disciplinary spectrum of ageing and diversity research to derive empirically testable hypotheses on the effects of age diversity on company productivity. It argues that first the balance between costs and benefits of diversity determines the effect of age diversity on company productivity and that second the type of task performed acts as a moderator. To test these hypotheses, it uses a large-scale employer-employee panel data set (the LIAB.) Results show that increasing age diversity has a positive effect on company productivity if and only if a company engages in creative rather than routine tasks.
    Keywords: Age Diversity, Company Performance, Productivity in Innovative Industries, Aging Societies
    Date: 2013–08
  15. By: Lee Biggerstaff; David C. Cicero; Andy Puckett
    Abstract: We show that firms with CEOs who personally benefitted from options backdating were more likely to engage in other forms of corporate misbehavior, suggestive of an unethical corporate culture. These firms were more likely to overstate firm profitability and to engage in less profitable acquisition strategies. The increased level of corporate misbehaviors is concentrated in firms with suspect CEOs who were outside hires, consistent with adverse selection in the market for chief executives. Difference-in-differences tests confirm that the propensity to engage in these activities is significantly increased following the arrival of an outside-hire ‘suspect’ CEO, suggesting that causation flows from the top executives to the firm. Finally, while these suspect CEOs appear to have avoided market discipline when the market was optimistic, they were more likely to lose their jobs and their firms were more likely to experience dramatic declines in value during the ensuing market correction.
    JEL: G3 G34
    Date: 2013–07

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