nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2017‒11‒19
twelve papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Measuring Indirect Effects of Unfair Employer Behavior on Worker Productivity – A Field Experiment By Matthias Heinz; Sabrina Jeworrek; Vanessa Mertins; Heiner Schumacher; Matthias Sutter
  2. The Impact of Incentive Pay on Corporate Crime By Daniel Herold
  3. Wages, Human Capital, and Structural Transformation By Berthold Herrendorf; Todd Schoellman
  4. The Mediating Role of Job Satisfaction between Training and Development Practices and Organizational Commitment: Responses from Private Banking Sectors of Karachi, Pakistan By Faridi, Adnan; Baloch, Akhtar; Wajidi, Abuzar
  5. Pay, Rank and Job Satisfaction amongst Academic Economists in the UK. By Karen Mumford; Cristina Sechel
  6. The effect of peer gender on major choice By Ulf Zölitz; Jan Feld
  7. The impact of peer personality on academic achievement By Bart H.H. Golsteyn; Arjan Non; Ulf Zölitz
  8. Globalizing labor and the world economy: the role of human capital By DELOGU Marco; DOCQUIER Frédéric; MACHADO Joël
  9. Do Gender Preference Gaps Impact Policy Outcomes? By Ranehill, Eva; Weber, Roberto A.
  10. Physician behavior under prospective payment schemes: Evidence from artefactual field and lab experiments By Hafner, Lucas; Reif, Simon; Seebauer, Michael
  11. Employer size and supervisor earnings: Evidence from Britain By Colin Green; John S. Heywood; Nikolaos Theodoropoulos
  12. Has the push for equal gender representation changed the role of women on German supervisory boards? By Viktor Bozhinov; Christopher Koch; Thorsten Schank

  1. By: Matthias Heinz (University of Cologne and CEPR); Sabrina Jeworrek (Halle Institute for Economic Research and Otto von Guericke University Magdeburg); Vanessa Mertins (University of Vechta); Heiner Schumacher (KU Leuven); Matthias Sutter (Max Planck Institute for Research on Collective Goods)
    Abstract: We present a field experiment in which we set up a call-center to study how the productivity of workers is affected if managers treat their co-workers in an unfair way. This question cannot be studied in long-lived organizations since workers may change their career expectations (and hence effort) when managers behave unfairly towards co-workers. In order to rule out such confounds and to measure productivity changes of unaffected workers in a clean way, we create an environment where employees work for two shifts. In one treatment, we lay off parts of the workforce before the second shift. Compared to two different control treatments, we find that, in the layoff treatment, the productivity of the remaining, unaffected workers drops by 12 percent. We show that this result is not driven by peer effects or altered beliefs about the job or the managers’ competence, but rather related to the workers’ perception of unfair behavior of employers towards co-workers. The latter interpretation is confirmed in a survey among professional HR managers. We also show that the effect of unfair behavior on the productivity of unaffected workers is close to the upper bound of the direct effects of wage cuts on the productivity of affected workers. This suggests that the price of an employer’s unfair behavior goes well beyond the potential tit-for-tat of directly affected workers.
    Keywords: Gift exchange, Layoffs, Labor Markets, Fairness, Field Experiment
    JEL: C93 J50 J63
    Date: 2017–11
  2. By: Daniel Herold (Justus-Liebig-University Giessen)
    Abstract: This paper presents a moral hazard model analyzing the agent's incentive to commit corporate crime. The principal can only observe profits which the agent can increase by committing crime or exerting effort. It is shown how different incentive contracts, i.e., thresholdlinear, capped bonus and linear contracts, can be adjusted in order to promote agent's law abiding behavior. Any adjustment implies a loss in internal eciency which decreases in individual sanctions imposed on the agent.
    Keywords: moral hazard, incentive pay, corporate crime, cartels
    JEL: D82 D86 L14 L22 K20 K21
    Date: 2017
  3. By: Berthold Herrendorf; Todd Schoellman
    Abstract: Average wages are considerably lower in agriculture than in the other sectors. We document this fact for thirteen countries ranging from rich (Canada, U.S.) to poor (India, Indonesia). We develop a measure of human capital that accounts for the selection of workers with different unobserved skills into sectors. We find that differences in human capital account for most of the wage gaps. We develop a model that rationalizes this finding and that allows us to quantify the distortions to the allocation of labor. We find that they are considerably smaller than typically claimed in the literature.
    Keywords: human capital gaps, misallocation of labor, wage gaps
    JEL: O10
    Date: 2017
  4. By: Faridi, Adnan; Baloch, Akhtar; Wajidi, Abuzar
    Abstract: This paper examines the impact of modern and traditional training and development programs on the employees of banking sectors' organizational commitment and overall performance within Karachi, Pakistan. Furthermore, the paper explores the causal-effect relationship between organizational commitment's distinctive attributes and T&D program through mediating role of job satisfaction, by particularly looking at the contractual and permanent employees. By combining the strata, convenience, and purposive sampling, we gathered data from the 307 employees working in the Karachi's banking sector. Since, the study falls largely into positivist paradigm thus quantitative analysis are conducted in this study. Interestingly, the findings revealed that modern methods of training and development are highly preferred by the contractual workers. In addition to that, the working efficiency of the employees aging between 30-40 years is significant positively affected by modern T&D methods. On the other hand, working efficiency does not improve for the permanent employees under both; traditional and modern methods to notable extent. In addition to that, irrespective of the type of employment status, the affective and normative commitment of male employees is significant positively affected by the salary increment while the continuance commitment of female workers is significant positively affected by the training and development programs. Nevertheless, job satisfaction has significant mediating role in improving the organizational commitment of employees under both; traditional and modern methods of training and development. Interestingly, the continuance commitment is less visible in contrast to affective commitment and normative commitment among both permanent and contractual employees working within the banking sector.
    Keywords: Contractual employees, permanent employees, job satisfaction, organizational commitment, T&D program, banking sector
    JEL: M0 M12 M5 M53
    Date: 2017–06–20
  5. By: Karen Mumford; Cristina Sechel
    Abstract: We use new data to explore the determinants of pay, rank, and job satisfaction for academic economists in the UK. After allowing for a broad range of characteristics, including measures of individual productivity and workplace features, we find a raw (unconditional) gender salary difference of 15 log percentage points (lpp) and a conditional gender pay gap of 9 lpp. This aggregate pay gap is strongly influenced by the relative concentration of men in higher paid job ranks where there are also within-rank gender pay gaps. Nevertheless, the majority of academic economists (male and female) are satisfied with their job.
    Keywords: economics, gender, pay, satisfaction, gaps, academia.
    JEL: A1 A11 A2 I3 J01 J31 J7
    Date: 2017–11
  6. By: Ulf Zölitz; Jan Feld
    Abstract: This paper investigates how the peer gender composition in university affects students' major choices and labor market outcomes. Women who are randomly assigned to more female peers become less likely to choose male-dominated majors, they end up in jobs where they work fewer hours and their wage grows at a slower rate. Men become more likely to choose male-dominated majors after having had more female peers, although their labor market outcomes are not affected. Our results suggest that the increasing female university enrolment over recent decades has paradoxically contributed to the occupational segregation among university graduates that persists in today’s labor market.
    Keywords: Peer effects, major choice, gender composition
    JEL: I21 I24 J24
    Date: 2017–11
  7. By: Bart H.H. Golsteyn; Arjan Non; Ulf Zölitz
    Abstract: This paper provides evidence of a novel facet of peer effects by showing how peer personality affects educational achievement. We exploit random assignment of students to university sections and find that students perform better in the presence of more persistent peers and more risk-averse peers. In particular, low-persistence students benefit from highly-persistent peers without devoting additional efforts to studying. However, highly-persistent students are not affected by the persistence of their peers. The personality peer effects that we document are distinct from other observable peer characteristics and suggest that the personality traits of peers causally affect human capital accumulation.
    Keywords: Personality, peer effects, non-cognitive skills
    JEL: I21 I24 J24
    Date: 2017–11
  8. By: DELOGU Marco; DOCQUIER Frédéric; MACHADO Joël
    Abstract: We develop a dynamic model of the world economy that jointly endogenizes individual decisions about fertility, education and migration. We then use it to compare the shortand long-term effects of immigration restrictions on the world distribution of income. Our calibration strategy replicates the economic and demographic characteristics of the world, and allows us to proxy bilateral migration costs and visa costs for two classes of workers and for each pair of countries. In our benchmark simulations, the world average level of income per worker increases by 12% in the short term and by approximately 52% after one century. These results are highly robust to our identifying strategy and technological assumptions. Sizable differences are obtained when our baseline (pre-liberalization) trajectory involves a rapid income convergence between countries or when we adjust visa costs for a possible upward bias. Our quantitative analysis reveals that the effects of liberalizing migration on human capital accumulation and income are gradual and cumulative. Whatever is the size of the short-term gain, the long-run impact is 4 to 5 times greater (except under a rapid convergence in income).
    Keywords: Migration; Migration policy; Liberalization; Growth; Human Capital; Fertility; Inequality
    JEL: F22
    Date: 2017–11
  9. By: Ranehill, Eva (Department of Economics, School of Business, Economics and Law, Göteborg University); Weber, Roberto A. (Department of Economics, University of Zurich)
    Abstract: A large body of evidence documents systematic gender differences in a variety of important economic preferences, such as risk-taking, competition and pro-sociality. One potential implication of this literature is that increased female representation in decision-making bodies may significantly affect organizational and policy outcomes. However, research has yet to establish a direct connection from gender differences in simple economic choice tasks, to voting over policy and to the resulting outcomes. We conduct a laboratory experiment to provide a test of such a connection. In small laboratory “societies,” people repeatedly vote for a redistribution policy and engage in a real-effort production task. In this environment, we observe a substantial difference in voting behavior, with women voting for significantly more egalitarian redistribution policies. This gender difference is large relative to other differences based on observable characteristics and is partly explained by gender gaps in economic preferences and in beliefs about relative performance. Gender voting gaps persist with experience and in environments with varying degrees of risk. We also observe policy differences between male- and female-controlled groups, though these are considerably smaller than the mean individual differences—a natural consequence of the aggregation of individual preferences into collective outcomes. Thus, we provide evidence for why substantial and robust gender differences in preferences may often fail to translate into differential policy outcomes with increased female representation in policymaking.
    Keywords: gender differences; risk; altruism; redistributive preferences; experiment
    JEL: C91 C92
    Date: 2017–11
  10. By: Hafner, Lucas; Reif, Simon; Seebauer, Michael
    Abstract: Recent experimental studies analyze the behavior of physicians towards patients and find that physicians care for their own profit as well as patient benefit. In this paper, we extend the experimental analysis of the physician decision problem by adding a third party representing the health insurance which finances medical service provision. Our results show that physicians take into account the payoffs of the third party, which can lead to underprovision of medical services. We conduct a laboratory experiment in neutral as well as medical framing using students and medical doctors as subjects. Subjects in the medically framed experiments behave weakly more patient orientated in contrast to neutral framing. A sample of medical doctors exhibits comparable behavior to students with medical framing.
    Keywords: health economic experiment,framing,physician behavior,prospective payment schemes
    JEL: C91 C93 I11 I18
    Date: 2017
  11. By: Colin Green; John S. Heywood; Nikolaos Theodoropoulos
    Abstract: Using British linked employer-employee data, we show that the establishment size effect for supervisors is approximately twice that for non-supervisors. This difference is routinely statistically significant, not explained by other controls and is an important determinant of the difference in earnings between supervisors and non-supervisors. Moreover, we use separate British longitudinal data to confirm both the statistically different effect and that it is not explained by worker fixed effects. Event study evidence and information on skill match suggest that the larger return to supervisors reflects, in large part, match specific returns supporting the view that talented supervisors receive a return on that talent only with larger employers.
    Keywords: Supervisor; Hierarchy; Size wage effect
    JEL: M52 D22
    Date: 2017–11
  12. By: Viktor Bozhinov (Johannes Gutenberg-University Mainz, Germany); Christopher Koch (Johannes Gutenberg-University Mainz, Germany); Thorsten Schank (Johannes Gutenberg-University Mainz, Germany)
    Abstract: In Germany, an intensive public debate about increasing female participation in leadership positions started in 2009 and proceeded until the beginning of 2015, when the German parliament enacted a board gender quota. In that period, the share of women on supervisory boards for 111 German publicly listedand fully codetermined companies (i.e. those which are affected by the quota law) more than doubled from 10.6 percent in 2009 to 22.6 percent in 2015. In 2016, the first year when the law was effective,the female share increased again by 4.5 percentage points. Using a hand-collected dataset, we investigate whether the rise in female board representation was accompanied by a change in gender differences in board member characteristics and board involvement. We do not find evidence for the “Golden Skirts” phenomenon, i.e., the rise in the female share was not achieved via a few female directors holding multiple board memberships. After controlling for firm heterogeneity, the remuneration of female shareholder (employee) representatives is about 16 (9) percent lower than for males. We interpret this as an overall indication that women are not only underrepresented in German supervisory boards,they are even more underrepresented in importantboard positions. Indeed, women are less likely to become a chairman and are less often assigned to board committees (except for the nominating committee). Moreover, in 2016 the disadvantage of women (as compared to men) to obtain a committee membership is even larger than in 2009.
    Keywords: gender diversity, women on boards, gender quota, board remuneration, committee membership
    Date: 2017–09

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