nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2015‒08‒07
eight papers chosen by
Tommaso Reggiani
Universität zu Köln

  1. Hiring and Escalation Bias in Subjective Performance Evaluations: A Laboratory Experiment By Andrej Angelowski; Jordi Brandts; Carles Solà
  2. The Effect of Mergers, Divestitures, and Board Composition on CEO Compensation Before and After the Financial Crisis By Ralph Sonenshine; Nathan Larson; Michael Cauvel
  3. Wage Penalties for Motherhood and Child-rearing in Post-Soviet Russia By Pritchett, Irina
  4. Procrastination and projects By Külpmann, Philipp
  5. Bargaining, Sorting, and the Gender Wage Gap: Quantifying the Impact of Firms on the Relative Pay of Women By David Card; Ana Rute Cardoso; Patrick Kline
  6. The Impact of Goal Achievement on User Effort By Tobias Mutter
  7. Peer Effects in Middle School Students’ Test Scores with Accounting for Individual Heterogeneity By Jordan, Jeffrey L.; Munasib, Abdul; Castillo, Marco; Petrie, Ragan
  8. Improving Educational Outcomes in Developing Countries: Lessons from Rigorous Evaluations By Murnane, RJ; Ganimian, A. J.

  1. By: Andrej Angelowski; Jordi Brandts; Carles Solà
    Abstract: In many organizations the measurement of job performance can not rely on easily quantifiable information. In such cases, supervising managers often use subjective performance evaluations. We use laboratory experiments to study whether the way employees are assigned to a manager affects managers’ and co-employees’ subjective evaluations of employees. Employees can either be hired by the manager, explicitly not hired by him and nevertheless assigned to him or exogenously assigned to him. We present data from four different treatments. For all four treatments we find escalation bias by managers. Managers exhibit a positive bias towards those employees they have hired or a negative one towards those they have explicitly not hired. For three treatments we find that managers’ and employees’ biases are connected. Exogenously assigned employees are biased in favor of employees hired by the manager and against those explicitly not hired.
    Keywords: escalation bias, hiring, performance evaluations, experiments
    JEL: C92 D83 J63
    Date: 2015–07
  2. By: Ralph Sonenshine; Nathan Larson; Michael Cauvel
    Abstract: This paper revisits the determinants of CEO compensation using recent data (covering 125 firms from 2003 to 2012) spanning the 2008 financial crisis. Overall, consistent with earlier studies, we find firm size and board composition to be the most consistent indicators of CEO pay. However, pay becomes more performance-oriented in the years after the financial crisis, which may reflect tighter governance. We give particular attention to the role played by changes in the CEO’s scope due to mergers and divestitures – the latter has seldom been considered before. We also investigate how these factors differ by industry.
    JEL: G34 G3 M12 M41
    Date: 2015
  3. By: Pritchett, Irina
    Keywords: Labor and Human Capital,
    Date: 2015
  4. By: Külpmann, Philipp (Center for Mathematical Economics, Bielefeld University)
    Abstract: In this paper I analyze a dynamic moral hazard problem in teams with imperfect monitoring in continuous time. In the model, players are working together to achieve a breakthrough in a project while facing a deadline. The effort needed to achieve such a breakthrough is unknown but players have a common prior about its distribution. Each player is only able to observe their own effort, not the effort of others. I characterize the optimal effort path for general distributions of breakthrough efforts and show that, in addition to free-riding, procrastination arises. Furthermore, in this model, procrastination is not a result of irrational behavior and is even present in the welfare-maximizing solution.
    Keywords: Procrastination, Public good provision , Moral hazard in teams
    Date: 2015–07–29
  5. By: David Card; Ana Rute Cardoso; Patrick Kline
    Abstract: There is growing evidence that firm-specific pay premiums are an important source of wage inequality. These premiums will contribute to the gender wage gap if women are less likely to work at high-paying firms or if women negotiate (or are offered) worse wage bargains with their employers than men. Using longitudinal data on the hourly wages of Portuguese workers matched with income statement information for firms, we show that the wages of both men and women contain firm-specific premiums that are strongly correlated with simple measures of the potential bargaining surplus at each firm. We then show how the impact of these firm-specific pay differentials on the gender wage gap can be decomposed into a combination of sorting and bargaining effects. We find that women are less likely to work at firms that pay higher premiums to either gender, with sorting effects being most important for low- and middle-skilled workers. We also find that women receive only 90% of the firm-specific pay premiums earned by men. Importantly, we find the same gender gap in the responses of wages to changes in potential surplus over time. Taken together, the combination of sorting and bargaining effects explain about one-fifth of the cross-sectional gender wage gap in Portugal.
    JEL: J16 J31 J71
    Date: 2015–07
  6. By: Tobias Mutter (University of Paderborn)
    Abstract: We empirically investigate the impact of successful goal achievement on future effort to attain the next goal in a recurring goal framework. We use data from a popular German Question & Answer community where goals are represented in the form of badges. Our findings indicate that after successful badge achievement users increase their subsequent effort to attain the next badge, but only as long as badges represent a challenge to the user. The key driver for this behavior, according to our analysis, appears to be self-learning.
    Keywords: Goal Setting Theory, Recurring Goals, Self-Learning, Gamification, Badges
    JEL: M52 M31
    Date: 2014–09
  7. By: Jordan, Jeffrey L.; Munasib, Abdul; Castillo, Marco; Petrie, Ragan
    Abstract: We estimate economically significant peer effects in test scores in the population of eighth grade students from a typical county school district in the U.S. state of Georgia. For identification we utilize the variation across test scores within the individual student to account for individual unobserved heterogeneity.
    Keywords: Test score, peer effect, individual unobserved heterogeneity, Institutional and Behavioral Economics, Labor and Human Capital, I2, J01, C31,
    Date: 2015
  8. By: Murnane, RJ; Ganimian, A. J.
    Abstract: This paper describes four lessons derived from 115 rigorous impact evaluations of educational initiatives in 33 low- and middle-income countries. First, reducing the costs of going to school and providing alternatives to traditional public schools increase attendance and attainment, but do not consistently increase student achievement. Second, providing information about school quality and returns to schooling generally improves student attainment and achievement, but building parents? capacity works only when focused on tasks they can easily learn to perform. Third, more or better resources do not improve student achievement unless they change children?s daily experiences at school. Finally, well-designed incentives for teachers increase their effort and improve the achievement of students in very low performance settings, but low-skilled teachers need specific guidance to reach minimally acceptable levels of instruction.
    Date: 2014–01

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