nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2017‒06‒25
six papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Training Contracts, Employee Turnover, and the Returns from Firm-Sponsored General Training By Hoffman, Mitchell; Burks, Stephen V.
  2. Flexible contracts By Piero Gottardi; Jean-Marc Tallon; Paolo Ghirardato
  3. The internationalisation of firms and management practices : a survey of firms in Viet Nam By Kamata, Isao; Sato, Hitoshi; Tanaka, Kiyoyasu
  4. Learning about Oneself: The Effects of Performance Feedback on School Choice By Matteo Bobba; Verónica Frisancho
  5. The value of reference letters By Martin Abel; Rulof Burger; Patrizio Piraino
  6. I (Don't) Like You! But Who Cares? Gender Differences in Same Sex and Mixed Sex Teams By Gerhards, Leonie; Kosfeld, Michael

  1. By: Hoffman, Mitchell (University of Toronto); Burks, Stephen V. (University of Minnesota, Morris)
    Abstract: Firms may be reluctant to provide general training if workers can quit and use their gained skills elsewhere. "Training contracts" that impose a penalty for premature quitting can help alleviate this inefficiency. Using plausibly exogenous contractual variation from a leading trucking firm, we show that two training contracts significantly reduced post-training quitting, particularly when workers are approaching the end of their contracts. Simulating a structural model, we show that observed worker quit behavior exhibits aspects of optimization (for one of the two contracts), and that the contracts increased firm profits from training and reduced worker welfare relative to no contract.
    Keywords: training contract, firm-sponsored general training, organizations, trucking, truck driver, truckload
    JEL: J24 M53 J41
    Date: 2017–06
  2. By: Piero Gottardi (European University Institute - Department of Economics); Jean-Marc Tallon (PSE - Paris School of Economics); Paolo Ghirardato (Collegio Carlo Alberto - Via Real Collegio 30)
    Abstract: This paper studies the costs and benefits of delegating decisions to superiorly informed agents, that is of adopting flexible contracts, relative to the use of rigid, non discretionary contracts. The main focus of the paper lies in the analysis of the costs of delegation, primarily agency costs, versus their benefits, primarily the flexibility of the action choice in two different environments, one with risk and one with ambiguity. We first determine and characterize the properties of the optimal flexible contract. We then show that the higher the agent's degree of risk aversion, the higher is the agency costs of delegation and the less profitable a flexible contract relative to a rigid one. When the parties have imprecise probabilistic beliefs, the agent's degree of imprecision aversion introduces another agency cost, which again reduces the relative profitability of flexible contracts. JEL Classification: D86, D82, D81.
    Keywords: Multiple Priors,Imprecision Aversion,Flexibility,Delegation,Agency Costs
    Date: 2017–05
  3. By: Kamata, Isao; Sato, Hitoshi; Tanaka, Kiyoyasu
    Abstract: This study examines the role of management practices in the internationalisation of domestic firms through directly exporting and/or supplying to local affiliates of multinationals. An original survey of manufacturing firms in Viet Nam was conducted, investigating their management practices such as human resource management and internationalisation status. The survey results shed light on similarities and dissimilarities among firms in several dimensions of management practices. We found that internationalised firms tended to be more enthusiastic about the formal training of production workers, the modernisation of production and operation, and product and process innovation. Differences in skills and experience requirements for newly employed managers were less recognisable, but internationalised firms tended to have managers who studied overseas. Furthermore, the use of public support to employee training, teamwork in production, and unionisation of employees did not show a significant difference between internationalised and non-internationalised firms.
    Keywords: Industrial management,Business enterprises,Globalization,Management Practices,Firm Heterogeneity,Global Value Chains
    JEL: F23 F61 M11 M50
    Date: 2017–03
  4. By: Matteo Bobba; Verónica Frisancho
    Abstract: This paper designs and implements a field experiment that provides students from less advantaged backgrounds with individualized feedback on academic performance during the transition from middle to high school. The intervention reduces the gap between expected and actual performance, as well as shrinks the variance of individual ability distributions. Guided by a simple Bayesian model, the paper empirically documents the interplay between variance reductions and mean changes of beliefs in shaping curricular choices. The shift in revealed preferences on high school tracks enabled by the intervention affects schooling trajectories, with better-performing students being assigned into more academically oriented options.
    Keywords: Vocational Education and Training, School Attendance, High School, School Enrollment, Higher Education, Human Capital Investment, Labor markets, Academic achievement, School Choice, Academic Performance, information, Bayesian updating, biased beliefs, school choice
    JEL: J24 I24 I21 D83
    Date: 2016–11
  5. By: Martin Abel (Faculty of Arts and Sciences, Harvard University); Rulof Burger (Department of Economics, Stellenbosch University); Patrizio Piraino (School of Economics, University of Cape Town)
    Abstract: We show that reference letters from former employers alleviate information asymmetries about workers’ skills and improve both match quality and equity in the labor market. A resume audit study finds that using a reference letter in the application increases callbacks by 61%. Women disproportionately benefit. Letters are effective because they provide valuable information about workers’ skills that employers use to select applicants of higher ability. A second experiment, which encourages job seekers to obtain and use a reference letter, finds consistent results. In particular, employment rates for women who obtain letters double, fully closing the gender gap in our sample.
    Keywords: Unemployment, references, South Africa, active labor market policies
    JEL: D83 J24 M51
    Date: 2017
  6. By: Gerhards, Leonie (University of Hamburg); Kosfeld, Michael (Goethe University Frankfurt)
    Abstract: We study the effect of likability on female and male team behavior in a lab experiment. Extending a two-player public goods game and a minimum effort game by an additional pre-play stage that informs team members about their mutual likability we find that female teams lower their contribution to the public good in case of low likability, while male teams achieve high levels of cooperation irrespective of the level of mutual likability. In mixed sex teams, both females' and males' contributions depend on mutual likability. Similar results are found in the minimum effort game. Our results offer a new perspective on gender differences in labor market outcomes: mutual dislikability impedes team behavior, except in all-male teams.
    Keywords: gender differences, likability, experiment, team behavior
    JEL: C90 J16
    Date: 2017–06

This nep-hrm issue is ©2017 by Patrick Kampkötter. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.