nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2018‒09‒10
nine papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Work Motivation and Teams By Simone Haeckl; Rupert Sausgruber; Jean-Robert Tyran
  2. Innovating for the Better? The Role of Advocacy Group Work Experience for Employee Pay By Grimpe, Christoph; Kaiser, Ulrich; Sofka, Wolfgang
  3. Flexible Work Organization and Employer Provided Training: Evidence from German Linked Employer-Employee Data By Campaner, Annika; Heywood, John S.; Jirjahn, Uwe
  4. Cognitive and non-cognitive skills, hiring channels, and wages in Bangladesh By Anne Hilger; Christophe Jalil Nordman; Leopold R. Sarr
  5. Wealth and the principal-agent matching By Paulo Fagandini
  6. Gender Wage Gap at the Top, Job Inflexibility and Product Market Competition By Heyman, Fredrik; Norbäck, Pehr-Johan; Persson, Lars
  7. Hunting with two bullets: moral hazard with a second chance By Paulo Fagandini
  8. Discrimination, Managers, and Firm Performance: Evidence from "Aryanizations" in Nazi Germany* By Huber, Kilian; Lindenthal, Volker; Waldinger, Fabian
  9. Organizational Commitment And Intention To Leave : The Moderating Role Of Uncertainty Avoidance By Mehlika Saraç; Reeta Raina

  1. By: Simone Haeckl (Department of Economics, Vienna University of Economics and Business); Rupert Sausgruber (Department of Economics, Vienna University of Economics and Business); Jean-Robert Tyran (Department of Economics, University of Copenhagen)
    Abstract: We provide a new measure of work motivation and show that motivation shapes the effects of team incentives and observation by peers on performance. In particular, we measure motivation to work hard as the deviation from the money-maximizing benchmark in a real-effort experiment. While we find that average output increases in response to team incentives and observation, we find that highly motivated workers do not respond. The reason is that highly motivated workers already work hard and increasing effort even further is very costly to them.
    Keywords: real-effort experiment, cooperation, team, intrinsic motivation, labors
    JEL: C91 J33 L20
    Date: 2018–08–23
  2. By: Grimpe, Christoph (Copenhagen Business School); Kaiser, Ulrich (University of Zurich); Sofka, Wolfgang (Copenhagen Business School)
    Abstract: How valuable is work experience with advocacy groups, e.g. Greenpeace, for new hires of innovative firms? We integrate strategic human capital with stakeholder theory and suggest that this experience creates scarce human capital (knowledge, skills, abilities) facilitating innovations acceptable and legitimate for stakeholders such as regulators or residents. We argue that such human capital is complementary to firm resources and leads to a value surplus. Individuals with advocacy group work experience can subsequently appropriate at least parts of that surplus through higher salaries. Using matched data for 10,303 employees in Denmark, we find that new hires of innovative firms with advocacy group human capital enjoy salary premiums which are stronger in mature and technologically concentrated firms. Our findings have important implications for HR decision making.
    Keywords: resource complementarity, advocacy groups, scarce human capital, stakeholder theory, value creation and capture
    JEL: J24 J6 C21
    Date: 2018–06
  3. By: Campaner, Annika (University of Trier); Heywood, John S. (University of Wisconsin, Milwaukee); Jirjahn, Uwe (University of Trier)
    Abstract: We examine the hypothesis that flexible work organization involves greater skill requirements and, hence, an increased likelihood of receiving employer provided training. Using unique linked employer-employee data from Germany, we confirm that employees are more likely to receive training when their jobs are characterized by greater decision-making autonomy and task variety, two essential elements of flexibility. Critically, the training associated with workplace flexibility does not simply reflect technology. Skill-biased organizational change plays its own role. Moreover, we show that the training associated with workplace flexibility is disproportionately oriented toward employees with a greater formal education. Our results also provide modest evidence of an age bias of workplace flexibility. However, the link between workplace flexibility and training does not appear to differ by gender.
    Keywords: delegation, multitasking, skill-biased organizational change, training
    JEL: J24 L00 M53
    Date: 2018–07
  4. By: Anne Hilger (Paris School of Economics, IRD, UMR 225 DIAL, PSL, Université Paris Dauphine, LEDa, IFP (Pondicherry, India)); Christophe Jalil Nordman (IRD, UMR 225 DIAL, PSL, Université Paris Dauphine, LEDa, IFP (Pondicherry, India)); Leopold R. Sarr (The World Bank)
    Abstract: This paper uses a novel matched employer-employee data set representing the formal sector in Bangladesh to provide descriptive evidence of both the relative importance of cognitive and non-cognitive skills in this part of the labor market and the interplay between skills and hiring channels in determining wages. While cognitive skills (literacy, a learning outcome) a ect wages only by enabling workers to use formal hiring channels, they have no additional wage return. Non-cognitive skills, on the other hand, do not a ect hiring channels, but they do enjoy a positive wage return. This wage return di ers by hiring channel: those hired through formal channels bene t from higher returns to openness to experience, but lower returns to conscientiousness and hostile attribution bias. Those hired through networks enjoy higher wages for higher levels of emotional stability, but they are also punished for higher hostile attribution bias. This is in line with di erent occupational levels being hired predominantly through one channel or the other. We provide suggestive evidence that employers might use hiring channels di erently, depending on what skill they deem important: employers valuing communication skills, a skill that could arguably be observed during selection interviews, are associated with a larger within- rm wage gap between formal and network hires, while the importance of teamwork, a skill that is more dicult to observe at the hiring stage, is associated with a smaller wage gap.
    Keywords: cognitive skills, personality traits, networks, matched worker- rm data, Bangladesh
    JEL: J24 J31 J71 O12
    Date: 2018–05
  5. By: Paulo Fagandini
    Abstract: I study the role the agent's wealth plays in the principal-agent matching with moral hazard and limited liability. I consider wealth and talent as the agent's type, and size as the firm's (principal's) type. Because utility is not perfectly transferable in this setup, I use generalized increasing differences and find that wealthier agents match with bigger firms, when talent is homogeneous among them, whereas for equally wealthy agents, more talented agents will match with bigger firms. I describe economic conditions over types such that pairs of higher types will write contracts in which the agent obtains more than the information rents, through a higher bonus, increasing the expected surplus. Finally, I provide an example in which wealth is distributed among agents in such a way that it reverses the standard result of positive assortative matching between talent and firm size. JEL codes: D86, D82, C78, J33, M12
    Keywords: moral hazard, asymmetric information, matching, non transferable utility
    Date: 2017
  6. By: Heyman, Fredrik; Norbäck, Pehr-Johan; Persson, Lars
    Abstract: Research show that women are disadvantaged in inflexible occupations. We show that this will imply that female managers are on average more skilled than male managers. Due to the higher hurdles faced by women, only the most skilled among them will pursue a management career. This implies that female managers will, on average, be more beneficial for the firm when product market competition is intense. Using detailed matched employee-employer data, we find that (i) more intense product market competition leads to relatively higher wages for female managers and (ii) the share of female managers is higher in firms in more competitive industries.
    Keywords: Career; Competition; Gender wage-gap; Job Inflexibility; Management
    JEL: J7 L2 M5
    Date: 2018–07
  7. By: Paulo Fagandini
    Abstract: I study the moral hazard problem where an agent can create an extra instance of effort and potentially improve bad realizations of the outcome before the principal observes it. The agent cannot hide the outcome of his effort, but just the way he achieved it. Findings are that both, principal and agent, value the option of improving the outcome in case of a bad realization if doing so is cheap. I also find that contracted effort is not always decreasing in its cost. I also study the situation in which, if the principal can impose short deadlines and eliminate the agent's extra chance, under a broad range of scenarios, the principal will do so when the parameters make agency costs sufficiently high. Finally, if the creation of the extra instance can cause a punishment for the principal, and if that punishment is sufficiently big, the principal will avoid writing contracts that incentive effort only on the extra chance. JEL codes: D82, D86
    Keywords: moral hazard, asymmetric information, contract theory, second chance
    Date: 2018
  8. By: Huber, Kilian; Lindenthal, Volker; Waldinger, Fabian
    Abstract: We study whether antisemitic discrimination in Nazi Germany had economic effects. Specifically, we investigate how the forced removal of Jewish managers affected large German firms. We collect new data from historical sources on the characteristics of senior managers, stock prices, dividends, and returns on assets for firms listed on the Berlin Stock Exchange. After the removal of the Jewish managers, the senior managers at affected firms had fewer university degrees, less experience, and fewer connections to other firms. The loss of Jewish managers significantly and persistently reduced the stock prices of affected firms for at least 10 years after the Nazis came to power. We find particularly strong reductions for firms where the removal of the Jewish managers led to large decreases in managerial connections to other firms and in the number of university-educated managers. Dividend payments and returns on assets also declined. A back-of-the-envelope calculation suggests that the aggregate market valuation of firms listed in Berlin fell by 1.78 percent of German GNP. These findings imply that discrimination can lead to significant economic losses and that individual managers can be key to the success of firms.
    Keywords: "Aryanizations"; discrimination; firms; Managers; Nazi Germany
    JEL: G30 J7 J71 N24 N34 N8
    Date: 2018–07
  9. By: Mehlika Saraç (Uluda? University); Reeta Raina (FORE School of Management)
    Abstract: Research related to Industrial and Organizational Psychology has long been criticized for limiting its scope within single cultural context and not considering culture as a critical contingency variable to explain organizational behavior and human resources management (HRM) practices. This puts constrains upon both theories and practical solutions to the organizational problems (Barrett and Bass, 1976). The values-as-moderators framework has provided interesting information leading to a better understanding of the antecedents (Farh et al., 2007; Gelade et al., 2008) and consequences (Cohen, 2006; Johnson and Chang, 2006; Wasti and Can, 2008; Yao and Wang, 2006, García-Cabrera and García-Soto, 2011) of some work related attitudes. Tendency to avoid uncertainty in organizations varies along with the tendency to avoid ambiguities in society at large, which is a major component of national culture. Hofstede conceptualize uncertainty avoidance with three components: rule orientation, employment stability and stress and defined as ?the extend to which a society feels threatened by uncertain and ambiguous situations by establishing more formal rules, by not tolerating deviant ideas and behaviors, and believing in absolute truths and attainments of expertise? (Hofstede, 1980: 46). This study assumes that since employees high in uncertainty avoidance have greater tendency to rules, loyalty and emotional attachment to work and organization, they have strong desire to stay with the organization based on a sense of duty/ obligation or emotional attachment and they have fewer intentions to leave the organization than employees low in uncertainty avoidance. Therefore, the study attempts to investigate the moderating effect of one of the components of national culture, ?value-uncertainty avoidance? by focusing the differences between Turkey and India. Using data collected simultaneously from India and Turkey, authors conducted multi group structural equation modeling (SEM) approach to compare the relationship between organizational commitment and intention to leave across samples from two nations.
    Keywords: uncertainty avoidance, structural equation modeling, intention to quit, affective commitment, normative commitment, cross-cultural differences
    Date: 2018–07

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