nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2016‒12‒18
twelve papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Quantity, Quality, and Originality: The Effects of Incentives on Creativity By Katharina Laske; Marina Schroeder
  2. Promotion Incentives in the Public Sector: Evidence from Chinese Schools By Karachiwalla, Naureen; Park, Albert
  3. Trust the Police? Self-Selection of Motivated Agents into the German Police Force By Friebel, Guido; Kosfeld, Michael; Thielmann, Gerd
  4. Exploring Job Satisfaction and Happiness for those in Alternative Work Arrangements By Cheryl Carleton; Mary Kelly
  5. Pay for Performance and Beyond By Holmström, Bengt
  6. Making a Motivated Manager: A Census Data Investigation into Efficiency Differences Between Franchisee and Franchisor-Owned Restaurants By Matthew Sveum; Michael Sykuta
  7. Teams as Superstars: Effort and Risk Taking in Rank-Order Tournaments for Women and Men By Mario Lackner
  8. German management and organizational practices survey (GMOP 0813) : Data collection By Broszeit, Sandra; Laible, Marie-Christine
  9. Analysing Performance-Based Financing through the Lenses of the Principal-Agent Theory By Renmans, Dimitri; Paul, Elisabeth; Dujardin, Bruno
  10. Education quality and non-convergence By Danilo Paula de Souza; Mauro Rodrigues Junior
  11. Good Boss, Bad Boss, Workers' Mental Health and Productivity: Evidence from Japan By KURODA Sachiko; YAMAMOTO Isamu
  12. Serving the Public Interest in Several Ways: Theory and Empirics By Robert Dur; Max van Lent

  1. By: Katharina Laske (University of Cologne); Marina Schroeder (University of Cologne)
    Abstract: We introduce a novel experimental design in which creativity is incentivized and measured along three dimensions: quantity, quality and originality of ideas. We implement piece rate incentives for quantity alone, quantity in combination with quality and quantity in combination with originality and compare the results to a baseline with a fixed wage. We find that incentives significantly affect the quantity and average quality of ideas, but not the average originality. Incentives for both quantity and originality perform best in fostering innovative ideas.
    Keywords: creativity, multitasking, laboratory experiment, real-effort, incentives
    JEL: C91 J33 M52 O30
    Date: 2016–12
  2. By: Karachiwalla, Naureen; Park, Albert
    Abstract: We provide evidence that promotion incentives influence the effort of public employees by studying China's system of promotions for teachers. Predictions from a tournament model of promotion are tested using retrospective panel data on primary and middle school teachers. Consistent with theory, promotions are associated with wage increases, higher wage increases are associated with better performance, and teachers increase effort in years leading up to promotion eligibility but reduce effort if they are repeatedly passed over for promotion. Evaluation scores are positively associated with teacher time use and with student test scores, diminishing concerns that evaluations are manipulated.
    Keywords: China; incentives; promotions; teachers
    JEL: J31 J33 J45 M51
    Date: 2016–12
  3. By: Friebel, Guido; Kosfeld, Michael; Thielmann, Gerd
    Abstract: We conduct experimental games with police applicants in Germany to investigate whether intrinsically motivated agents self-select into public service. Our focus is on trustworthiness and the willingness to enforce norms as key dimensions of intrinsic motivation in the police context. We find that police applicants are more trustworthy than non-applicants, i.e., they return higher shares as second-movers in a trust game. Furthermore, they invest more in rewards and punishment when they can enforce cooperation as a third party. Our results provide clear evidence for advantageous self-selection into the German police force, documenting an important mechanism by which the match between jobs and agents in public service can be improved.
    Keywords: intrinsic motivation; norm enforcement; Public Service; Self-selection; trustworthiness
    JEL: C9 D64 D73 J45
    Date: 2016–12
  4. By: Cheryl Carleton (Department of Economics, Villanova School of Business, Villanova University); Mary Kelly (Department of Economics, Villanova School of Business, Villanova University)
    Abstract: There has been a rise in alternative work arrangements in recent years, with much variation in who selects these work arrangements and the reasons for doing so. Studies suggest that there is significant growth potential for workers in alternative work arrangements in the years ahead. These alternative work arrangements include independent contractors, self-employed workers, temp agency workers, on-call workers, and those who work for contractors who provide services to others. The growth in these jobs has been at both ends of the job spectrum: in professional occupations that require a high level of skill and knowledge, and in jobs at the other end of the job spectrum where the needed investments in human capital are much less. The impact on well-being of such work arrangements can thus vary by the type of work arrangement and by whether the occupation is professional or nonprofessional. Given the still prevalent difference in roles in the home, the impact may also vary by gender. This study explores variations in overall happiness and job satisfaction by work arrangement, by occupation, and by gender for respondents to the 2006, 2010 and 2014 Quality of Life Work Modules from the General Social Survey. Significant differences in overall happiness and job satisfaction are found for each of these groups. The changing nature of the job market makes studies of work and its impact on happiness and job satisfaction more complex. The growth in alternative work arrangements may stem in part from individual’s needs which are not met in more traditional jobs and is reflected in the impact they have on happiness and job satisfaction.
    Keywords: Job Satisfaction; Happiness; Alternative Work Arrangements; Well-being; Quality of Work Life
    JEL: J28 J16 J46
    Date: 2016–12
  5. By: Holmström, Bengt (MIT)
    Abstract: Bengt Holmström delivered his Prize Lecture on 8 December 2016 at the Aula Magna, Stockholm University.
    Keywords: Contract theory;
    JEL: D86
    Date: 2016–12–08
  6. By: Matthew Sveum; Michael Sykuta
    Abstract: While there has been significant research on the reasons for franchising, little work has examined the effects of franchising on establishment performance. This paper attempts to fill that gap. We use restricted-access US Census Bureau microdata from the 2007 Census of Retail Trade to examine establishment-level productivity of franchisee- and franchisor-owned restaurants. We do this by employing a two-stage data envelopment analysis model where the first stage uses DEA to measure each establishment’s efficiency. The DEA efficiency score is then used as the second-stage dependent variable. The results show a strong and robust effect attributed to franchisee ownership for full service restaurants, but a smaller and insignificant difference for limited service restaurants. We believe the differences in task programability between limited and full service restaurants results in a very different role for managers/franchisees and is the driving factor behind the different results.
    Keywords: Franchising, restaurants, data envelopment analysis, efficiency
    JEL: D23 D24 L83
    Date: 2016–01
  7. By: Mario Lackner
    Abstract: This article analyzes top-level basketball competitions and measures the effect of superstar presence on effort provision in rank-order tournaments. I extend the previous literature to team competitions for male and female teams, as well as different institutional settings over a long period of time. In addition, I analyze risk-taking behavior in the context of superstar effects. The results of the empirical analysis suggests that the level of superstar dominance is crucial for the observed effects. While there is an significant and sizeable effort reducing superstar effect, less (little) dominance by the superstar seems to be result in a positive peer effects.
    Keywords: uperstar effects, rank-order tournaments, incentives, effort, risk-taking
    JEL: D70 M51 J01
    Date: 2016–12
  8. By: Broszeit, Sandra (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Laible, Marie-Christine (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: The 'German Management and Organizational Practices' (GMOP) survey inquiries about management practices and firm performance at the establishment-level. The survey was con-ducted in German establishments in the manufacturing industry or the construction sector with at least 25 employees subject to social security. The dataset contains information about more than 1,900 establishments for the years 2008 and 2013. The present method report describes the process of data collection including conception of the questionnaire and data sampling.
    Date: 2016–12–07
  9. By: Renmans, Dimitri; Paul, Elisabeth; Dujardin, Bruno
    Abstract: We approach Performance-Based Financing (PBF) through the lenses of the Principal-Agent theory to critically analyse PBF and elucidate the principal elements, main challenges and possible pitfalls. We discern a framework comprised of eight dimensions: context and other stakeholders, main principals (government, donors, purchasing agency), verification officers, agents (health providers), the PBF contract, benefitting principals (patients), positive and negative effects, and costs and benefits. Moreover, PBF is seen as a package of choices over six elements: governance arrangements, matrix of indicators, monitoring and evaluation arrangements, financial incentive arrangements, dispute settlement mechanism, and ancillary components. We advise the use of ‘theory-based evaluations’ (TBE) to advance our knowledge on PBF. The proposed framework acts as a good starting point for TBE, given its comprehensiveness and reference to an established theory.
    Keywords: performance-based financing; PBF
    Date: 2016–12
  10. By: Danilo Paula de Souza; Mauro Rodrigues Junior
    Abstract: This paper assesses the role of education quality in the convergence process of GDP per capita through teachers quality impact in human capital formation. The simple two-period OLG model suggests initial level of teacher's human capital is important to explain non-convergence, even when education quality return is decreasing. This non-convergence arises because an initially low level of teachers' human capital translates into a low level of human capital transferred to students, which means a low level of teachers' human capital in the next period, and so on. It is also shown an education quantity-quality trade-off, despite all dynamics coming from quality evolution. This trade-off helps to explain why developing countries did not reached high GDP levels, despite recent evolution of average years of schooling in these countries. The paper, therefore, provides an alternative explanation for why countries income does not converge, even when differences in other inputs, such as capital stock, are not accounted for.
    Keywords: human capital; education quality; economic growth
    JEL: O40 J24 I25
    Date: 2016–10–24
  11. By: KURODA Sachiko; YAMAMOTO Isamu
    Abstract: It is widely believed that the relationship between a supervisor and his/her employees greatly affects employees' well-being and/or productivity. However, only a few papers in the economics literature analyze how supervisors influence employees' well-being and enhance productivity. This paper uses longitudinal data of employees with information about their immediate bosses' ability, management skills, and characteristics (such as competency, communication skills, and personality traits) to investigate the influence of supervisors on employees. The main findings are as follows. First, even after controlling for individual-specific fixed effects and other job characteristics, such as those proposed in the job strain model, we find that supervisors' good communication with staff and competency in managerial tasks significantly improve employees' mental health. Second, we find that good communication between the boss and his/her staff enhances the latter's productivity and lowers presenteeism. Third, supervisors' bad communication and low competency increase the probability of quitting. Fourth, good communication partially depends on boss-staff compatibility, which is governed in part by their combined personality traits.
    Date: 2016–12
  12. By: Robert Dur (Erasmus University Rotterdam, The Netherlands); Max van Lent (Erasmus University Rotterdam, The Netherlands)
    Abstract: We develop a model where people differ in their altruistic preferences and can serve the public interest in two ways: by making donations to charity and by taking a public service job and exerting effort on the job. Our theory predicts that people who are more altruistic are more likely to take a public service job and, for a given job, make higher donations to charity. Comparing equally altruistic workers, those with a regular job make higher donations to charity than those with a public service job by a simple substitution argument. We subsequently test these predictions using the German Socio-Economic Panel Study, which contains data on self-reported altruism, sector of employment, and donations to charity for more than 7,500 workers. We find support for our predictions, though some results are sensitive to the exact definition of a public service job or the estimation method.
    Keywords: altruism; charitable donations; public service motivation; public sector employment; self-selection
    JEL: D64 H11 J45 M50
    Date: 2016–12–13

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