nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2020‒01‒13
six papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Frequent Job Changes Can Signal Poor Work Attitude and Reduce Employability By Alain Cohn; Michel André Maréchal; Frédéric Schneider; Roberto A. Weber
  2. Some Contributions of Economics to the Study of Personality By James J. Heckman; Tomas Jagelka; Tim Kautz
  3. Agency Theory Meets Matching Theory By Inés Macho-Stadler; David Pérez-Castrillo
  4. The perks of being in the smaller team: Incentives in overlapping contests By March, Christoph; Sahm, Marco
  5. Human Capital Accountability and Construct: Evidence from Islamic Microfinance Institutions in Malaysia By Kamaluddin, Amrizah; Kassim, Nawal; Alam, Md. Mahmudul; Abu Samah, Siti Akmar
  6. Can too many cooks spoil the broth? Coordination costs, fatigue, and performance in high-intensity tasks By Bastian Kordyaka; Mario Lackner; Hendrik Sonnabend

  1. By: Alain Cohn; Michel André Maréchal; Frédéric Schneider; Roberto A. Weber
    Abstract: We study whether employment history provides information about a worker’s “work attitude,” i.e., the tendency to act cooperatively and reliably in the workplace. We conjecture that, holding all else equal, frequent job changes can indicate poor work attitude and that this information is transmitted through employment histories. We find support for this hypothesis across three studies that employ complementary lab, field, and survey experiments, as well as in labor market panel data. First, a tightly controlled laboratory labor market experiment demonstrates that prior employment information allows employers to screen for reliable and cooperative workers and that these workers obtain better employment outcomes. Second, we conduct a field experiment that varies the frequency of job changes in applicants’ resumes and find that those with fewer job changes receive substantially more callbacks from prospective employers. Third, a survey experiment with Human Resources professionals confirms that the resume manipulations in the field study create different perceptions of work attitude and that these largely account for the callback differences. Finally, we find evidence consistent with our hypothesized relationships in empirical labor market data. Our work highlights the potential importance of job history as a signal of work attitude in labor markets, and points to a potential cost of frequent job changes.
    JEL: C90 C93 J01 E24
    Date: 2019
  2. By: James J. Heckman (The University of Chicago); Tomas Jagelka; Tim Kautz (Mathematica)
    Abstract: This paper synthesizes recent research in economics and psychology on the measurement and empirical importance of personality skills and preferences. They predict and cause important life outcomes such as wages, health, and longevity. Skills develop over the life cycle and can be enhanced by education, parenting, and environmental influences to different degrees at different ages. Economic analysis clarifies psychological studies by establishing that personality is measured by performance on tasks which depends on incentives and multiple skills. Identification of any single skill therefore requires isolation of confounding factors, accounting for measurement error using rich data and application of appropriate statistical techniques. Skills can be inferred not only by questionnaires and experiments but also from observed behavior. Economists advance the analysis of human differences by providing anchored measures of economic preferences and studying their links to personality and cognitive skills. Connecting the research from the two disciplines promotes understanding of the number and nature of skills and preferences required to characterize essential differences.
    Keywords: preferences, psychology, behavioral economics, human diversity
    JEL: C91 C93 D12 D91
    Date: 2019–12
  3. By: Inés Macho-Stadler; David Pérez-Castrillo
    Abstract: The theory of incentives and matching theory can complement each other. In particular, matching theory can be a tool for analyzing optimal incentive contracts within a general equilibrium framework. We propose several models that study the endogenous payoffs of principals and agents as a function of the characteristics of all the market participants, as well as the joint attributes of the principal-agent pairs that partner in equilibrium. Moreover, considering each principal-agent relationship as part of a market may strongly influence our assessment of how the characteristics of the principal and the agent affect the optimal incentive contract. Finally, we discuss the effect of the existence of moral hazard on the nature of the matching between principals and agents that we may observe at equilibrium, compared to the matching that would happen if incentive concerns were absent.
    Keywords: Incentives, contracts, matching, moral hazard
    JEL: D86 D03 C78
    Date: 2020–01
  4. By: March, Christoph; Sahm, Marco
    Abstract: We investigate overlapping contests in multi-divisional organizations in which an individual's effort simultaneously determines the outcome of several contests on different hierarchical levels. We show that individuals in smaller units are advantaged in the grand (organization-wide) contest for two reasons: First, the incentive to free-ride is smaller in inter-divisional contests. Second, competition in the intradivisional contest is less fierce. Both effects induce a higher marginal utility of effort provision. We test the model in a laboratory experiment and confirm its main predictions. Our results have important consequences for the provision of incentives in organizations and the design of sports competitions.
    Keywords: Contest,Rent-seeking,Hierarchy,Teams,Experiment
    JEL: C72 C92 D72
    Date: 2019
  5. By: Kamaluddin, Amrizah; Kassim, Nawal; Alam, Md. Mahmudul (Universiti Utara Malaysia); Abu Samah, Siti Akmar
    Abstract: To identify the human capital construct that significantly relates to the performance of Islamic organizations, this study obtained data from Islamic microfinance organizations in Malaysia using the survey questionnaire method. In addition, we interviewed renowned scholars in the fields of Islamic accounting and Shariah law. Consequently, this study proposes an extended model of human capital that is applicable to Islamic organizations. Apart from knowledge and competency, this study includes spiritual value as another construct of human capital in Islamic organizations. Knowledge includes ideas that are relevant to the accounting and auditing spectra, as well as Shariah principles and jurisprudence. By contrast, competency refers to the ability to innovate unique Shariah-compliant products that are rare and difficult to imitate. Meanwhile, spiritual values embrace the elements of “Siddiq,” “Amanah,” “Fathonah,” and “Tabligh.” This study affirms that knowledge, competency, and satisfaction are the most significant constructs of human capital that explain performance. Factor analysis indicates that spiritual value is embedded in and forms part of the human capital construct. Hence, spiritual value is a key element in company culture and contributes significantly to organizational success. This model can be a platform for human capital reporting in the relevant Islamic and conventional organizations.
    Date: 2019–06–13
  6. By: Bastian Kordyaka; Mario Lackner; Hendrik Sonnabend
    Abstract: Workplace flexibility offers a wide range of opportunities but also carries risks within the context of collaborative tasks. While increasing the number of collaborators can reduce fatigue and therefore enhance performance, it also increases coordination costs. Our study investigates this trade-off in a complex team task with high effort costs in a natural setting. We use the instrumental variables method combined with an extensive sensitivity analysis to identify the causal effect of in-game substitutions on performance in professional basketball. Our findings suggest that increasing the number of collaborators, on balance negatively affects team performance. However, we also provide evidence that the most successful teams are able to optimally trade off both effects.
    Keywords: coordination costs, fatigue, productivity, team performance, substitutions
    JEL: D22 J4 J22 Z20
    Date: 2019–11

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