nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2014‒08‒02
eight papers chosen by
Tommaso Reggiani
Universität zu Köln

  1. Do-gooders and go-getters: career incentives, selection, and performance in public service delivery By Nava Ashraf; Oriana Bandiera; Scott Lee
  2. The indirect effect of monetary incentives on deception By Janna Ter Meer
  3. Designing the modern work environment to support important activities: An analysis of different preferences in 5 European countries By Appel-Meulenbroek, Rianne; Kemperman, Astrid; Liebregts, Marianne; Oldman, Tim
  4. Human Capital Formation from Occupations: The ‘Deskilling Hypothesis’ Revisited By Alexandra De Pleijt; Jacob Weisdorf
  5. REIT Managers’ Compensation Structure - The Effects on Capital Structure and REIT Performance By Biasin, Massimo; Quaranta, Anna Grazia
  6. The role of proximity in retrospective: organizations, ICT and human resources in Italian traditional districts’ firms. By Paolo Seri
  7. Priorities in Workplace Performance: a measure of spend and design By Sundberg, Anna; Chadburn, Ana
  8. Do leaders affect ethical conduct? By Giovanna d’Adda; Donja Darai; Roberto A. Weber

  1. By: Nava Ashraf; Oriana Bandiera; Scott Lee
    Abstract: We study how career incentives affect who selects into public health jobs and, through selection, their performance while in service. We collaborate with the Government of Zambia to experimentally vary the salience of career vs. social benefits of a newly created health worker position when recruiting agents nationally. We follow the entire first cohort from application to performance in the field and measure impacts at every stage. We find that making career incentives salient attracts more qualified applicants with stronger career ambitions without displacing pro-social preferences, which are high in both treatments. Health workers attracted by career incentives are more effective at delivering health services and are equally likely to remain in their posts over the course of 18 months. Career incentives, far from selecting the "wrong" types, attract talented workers who deliver health services effectively.
    Date: 2014–07
  2. By: Janna Ter Meer (University of Cologne)
    Abstract: This paper investigates whether working under competitive or cooperative incentives affects deception in a subsequent, unrelated task. I use a laboratory study with two stages. First, participants work under a piece rate, tournament or team incentive in a real effort task. The second part consists of a sender-receiver game where the sender can gain financially at the expense of the receiver by sending a deceptive message. I find that senders who worked under tournament incentives are less honest than those who worked under a piece rate. I find no increase in honesty for those who performed under team incentives relative to the piece rate. Interestingly, this only holds when participants are not informed about their relative performance during the work task. When such feedback is provided I find that relative performance affects honesty across all incentive conditions. In particular, honesty decreases as relative performance differences become small.
    JEL: M52 C92 D02 D03
    Date: 2014–07–07
  3. By: Appel-Meulenbroek, Rianne; Kemperman, Astrid; Liebregts, Marianne; Oldman, Tim
    Abstract: Purpose – Nowadays the worker is the most important production factor for knowledge organisations, and thus Corporate Real Estate Managers (CREM) must focus on supporting employees. Modern work environments must be designed to meet their preferences for satisfaction and leveraging talent. But the way employees experience and use the office environment depends on national culture, so implementing a new work environment might require different strategies in different countries. This paper describes research into employee preferences regarding work activities and the work environment in 5 European countries, and the implications of differences that came forward.Design/methodology/approach –Based on literature, hypotheses are formulated about the importance of different activities in and features/facilities of the modern work environment. These are tested with the Leesman database, from which 32,006 employee questionnaires from Sweden, the Netherlands, Great Britain, France and Germany were selected. The data are analysed with principal component analyses and Chi Square or F- Tests to study differences between the importance the employees in these 5 countries attached to 21 workplace activities, 19 workplace features and 18 workplace facilities.Findings – With regard to activities, the Germans value interaction activities, while the Dutch and Swedish employees mention collaboration activities as most important. With regard to workplace features/facilities, the French and Germans find it most important to be able to work place independent, while the Swedish care extra about meeting areas. Building services are only important to British employees. More differences between the countries are discussed, after relating the workplace components to the important activities.Implications –The results of this study make clear, that a one-size-fits-all concept is not always the best way for multinationals to support your employees.Originality value – Previous studies focused on employee satisfaction with the work environment that is offered (pre/post move) or asked designers about influence of culture. In this paper we actually ask employees what their preferences are, regardless of the current work environment. It is the first study that compares and tests differences between preferences of European employees on this scale, and also to study these preferences for the work environment in relation to preferences for certain activities and compare countries.
    Date: 2014
  4. By: Alexandra De Pleijt; Jacob Weisdorf
    Abstract: We use occupational titles from English parish registers in an attempt to test the deskilling hypothesis, i.e. the notion that England’s Industrial Revolution was mainly skill saving. We code the occupational titles of over 30,000 male workers according to the skillcontent of their work (using HISCLASS) to track the evolution of working skills in England between 1550 and 1850. Although we observe a minor rise in the share of ‘high-quality workmen’ deemed necessary by Mokyr and others to facilitate the Industrial Revolution, such as joiners, turners, and wrights, we also find considerable growth in the share of unskilled workers, from 20% in around 1700 to 39% in around 1850, fed mainly by falling shares of semi-skilled blue-collar workers, such as tailors, shoemakers, and weavers. This supports the view that England’s Industrial Revolution was not only skill saving on average but also involved a proletarianization of the English workforce.
    Keywords: Deskilling, HISCLASS, Human Capital, Industrial Revolution, Occupations
    Date: 2014–07
  5. By: Biasin, Massimo; Quaranta, Anna Grazia
    Abstract: REIT managers’ compensation structure typically provides a payment based alternatively on (i) “gross asset valueâ€? [GAV] or (ii) “net asset valueâ€? [NAV]. In addition, managers usually also gain a performance fee when REIT total return exceeds some minimum level.The paper analyses how the two alternative compensation schemes influence REITs’ investment decisions and capital structure and, consequently, REITs’ share performance at the investor level. The final issue addressed is whether one compensation scheme is superior to the other, i.e. if REITs having a fee-structure based on net asset values outperform REITs with a compensation indexed on gross asset value.Due to the (usually) market price discount on net asset values, both fee structures incentive managers to leverage – even in a tax-free environment – in order to maximize the calculation basis of management fees. However, the leverage motivation is stronger for GAV-based REITs than for NAV-based REITs, which are also expected to be more selective in investment decisions because only positive net present value investment projects increase their compensation basis. Overall, considering initial fee percentage, GAV-based REITs are expected to execute higher management fees than NAV-based REITs due to the relevant leverage effect. Moreover, debt recourse produces different effects on share value if measured upon market price or net asset value due to the different implicit valuation methodologies.The empirical analysis focuses on public Italian REITs for the period 2002-2012 and revises previous investigations for shorter periods of time. The results seem to support the theoretical expectations. GAV-based REITs have higher debt trends and levels than NAV-based REITs. At the same time, GAV-REITs generally experience lower real estate asset returns net of management fees for both current and growth yields. Differences in net real estate returns seem to lead to permanent higher performance over total return indexes of NAV-based REITs compared to GAV-based REITs.While the focus of the paper is largely on Italian REITs compensation, the issue addressed seems to be of broader interest due to the fact that similar compensation structures are also typical of other European REIT regimes.
    Date: 2014
  6. By: Paolo Seri (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo")
    Abstract: The existence of strong complementarities between ICT diffusion, investment in human capital and organizational innovations has been recently stressed both by theoretical and empirical literature on industrial organization and economic growth. For many scholars, one of the reasons of the delay of Italian industries in addressing rising global competitiveness and improving productivity can be traced back to the inability to create the right environment for the synergetic coevolution of the three above-mentioned variables. This paper tests the hypothesis that the coevolution within the firm of the three variables, could have been influenced by the belonging of the firms to industrial districts’ environments. In particular it controls whether firms which have made more use of proximity in their activity express retards or even “lock-in” phenomena in organizational innovations with respect to the two other complementary variables. After discussing the issue of coevolution for the three variables and the role that district environments can play for the formation of phenomena of organizational inertia, we test the hypothesis of co-evolution between organisations, ICT, and human resources through a survey of 223 ‘district’ and ‘non-district’ Italian small firms.
    Keywords: Coevolution, ICT, Human Capital, Organizational Change, Geographical Proximity.
    JEL: R11 D21 O30
    Date: 2014
  7. By: Sundberg, Anna; Chadburn, Ana
    Abstract: Background: The highest cost to any business is labour and in the UK this is typically followed by real estate (Bootle, 2002). How property affects business performance has been the focus of academic study for some time. Generally well procured and well managed space is thought to bring increased productivity, flexibility and enhanced corporate image (Krumm and De Vries (2003)). Occupiers’ response to a more competitive business environment has perhaps foremost been focused on attempts to save on real estate costs by occupying space more efficiently. Generally buildings now have to work harder with the allowance of space per worker is reported to have decreased from 12-17 sq m per work station to 8-13 sq m (BCO, 2013). Arguably we are only beginning to understand the impact that the office environment can have on business performance. Recent research has focused on the impact that the working environment is having on employees’ health and wellbeing measured through levels of employee satisfaction (Leaman, 1994), absenteeism (Preller, 1990), staff turnover (CABE, 2001) and the ability of the workplace to support different activities (CABE, 2001). This paper intends to measure annual spend on office occupancy based on rent, fitting out cost and maintenance and will investigate which property attributes that are prioritised in terms of spend amongst employers. Purpose: The purpose of this paper is to investigate the emphasis placed on creating a workplace environment that is ‘right’ measured through levels of spend on a range of property attributes thought to contribute to business productivity.Method: The paper will be based on survey of three categories of employers, namely professional services firms, financial services firms and media firms, whose working practices and culture are significantly different. The survey will be supported by a literature review of publications to date which considers employee satisfaction, productivity and workplace design.Results/conclusion: The paper will highlight employers’ awareness of office design features and their perception of their relative importance in terms of supporting business success and productivity. Results will also highlight the spend and design priorities and enable an analysis of the correlation between these and the attributes perceived to enhance the office environment and supporting business performance and productivity.
    Date: 2014
  8. By: Giovanna d’Adda; Donja Darai; Roberto A. Weber
    Abstract: We study whether leaders influence the unethical conduct of followers. To avoid selection issues present in natural environments, we use a laboratory experiment in which we form groups and assign leadership roles at random. We study an environment in which groups compete, with dishonest behavior enhancing group earnings to the detriment of social welfare. We vary, by treatment, two instruments through which leaders can influence follower conduct—prominent statements to the group and the allocation of monetary incentives. In general, the presence of active group leaders gives rise to significantly more dishonest behavior. Moreover, appointing leaders who are likely to have acted dishonestly in a preliminary stage of the experiment yields groups with significantly more unethical conduct. The analysis of leaders’ strategies reveals that leaders’ statements have a stronger effect on follower behavior than the ability to distribute financial rewards, and that leaders’ propensity to act dishonestly correlates with their use of statements or incentives as a means for encouraging dishonest follower conduct.
    Keywords: Leadership, ethics, dishonesty, experiment
    JEL: C92 C72 D03
    Date: 2014–07

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