nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2020‒03‒23
nine papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Informing employees in small and medium sized firms about training: results of a randomized field experiment By van den Berg, Gerard J.; Dauth, Christine; Homrighausen, Pia; Stephan, Gesine
  2. A Welfare Analysis of Occupational Licensing in U.S. States By Morris M. Kleiner; Evan J. Soltas
  3. The Role of Heterogeneous Risk Preferences, Discount Rates, and Earnings Expectations in College Major Choice By Arpita Patnaik; Joanna Venator; Matthew Wiswall; Basit Zafar
  4. Immigration and Worker-Firm Matching By Gianluca Orefice; Giovanni Peri
  5. Do Women Shy Away from Public Speaking? A Field Experiment By De Paola, Maria; Lombardo, Rosetta; Pupo, Valeria; Scoppa, Vincenzo
  6. Spatial Wage Gaps in Frictional Labor Markets By Sebastian Heise; Tommaso Porzio
  7. Does working at a start-up pay off? By Fackler, Daniel; Hölscher, Lisa; Schnabel, Claus; Weyh, Antje
  8. Mandated Sick Pay: Coverage, Utilization, and Welfare Effects By Johanna Catherine Maclean; Stefan Pichler; Nicolas R. Ziebarth
  9. A Quantitative Analysis of Distortions in Managerial Forecasts By Yueran Ma; Tiziano Ropele; David Sraer; David Thesmar

  1. By: van den Berg, Gerard J. (IFAU - Institute for Evaluation of Labour Market and Education Policy); Dauth, Christine (IAB (The Institute for Employment Research); Homrighausen, Pia (IAB (The Institute for Employment Research); Stephan, Gesine (IAB (The Institute for Employment Research)
    Abstract: We mailed brochures to 10,000 randomly chosen employed German workers eligible for a subsizided occupational training program called WeGebAU,informing them about the importance of skill-upgrading occupational training in general and about WeGebAU in particular. Using survey and register data,we estimate effects of the information treatment brochure on awareness of the program, on take-up of WeGebAU and other training,and on subsequent employment. The bRochure more than doubles awareness of the program. There are no effects on WeGebAU take-up but participation in other(unsubsidized) training increasesamong employees aged below 45. Short-term labor market outcomes are not affected.
    Keywords: employment; wages; skills; randomized controlled trial; information treatment
    JEL: J24 J65
    Date: 2020–02–27
  2. By: Morris M. Kleiner (National Bureau of Economic Research); Evan J. Soltas
    Abstract: We assess the welfare consequences of occupational licensing for workers and consumers. We estimate a model of labor market equilibrium in which licensing restricts labor supply but also affects labor demand via worker quality and selection. On the margin of occupations licensed differently between U.S. states, we find that licensing raises wages and hours but reduces employment. We estimate an average welfare loss of 12 percent of occupational surplus. Workers and consumers respectively bear 70 and 30 percent of the incidence. Higher willingness to pay offsets 80 percent of higher prices for consumers, and higher wages compensate workers for 60 percent of the cost of mandated investment in occupation-specific human capital.
    Keywords: Occupational licensing; Labor supply; Human capital; Welfare analysis
    JEL: D61 J24 J38 J44 K31
    Date: 2019–10–15
  3. By: Arpita Patnaik; Joanna Venator; Matthew Wiswall; Basit Zafar
    Abstract: In this paper, we estimate a rich model of college major choice using a panel of experimentally-derived data. Our estimation strategy combines two types of data: data on self-reported beliefs about future earnings from potential human capital decisions and survey-based measures of risk and time preferences. We show how to use these data to identify a general life-cycle model, allowing for rich patterns of heterogeneous beliefs and preferences. Our data allow us to separate perceptions about the degree of risk or perceptions about the current versus future payoffs for a choice from the individual's preference for risk and patience. Comparing our estimates of the general model to estimates of models which ignore heterogeneity in risk and time preferences, we find that these restricted models are likely to overstate the importance of earnings to major choice. Additionally, we show that while men are less risk averse and patient than women, gender differences in expectations about own-earnings, risk aversion, and patience cannot explain gender gaps in major choice.
    JEL: I23 J16 J24
    Date: 2020–02
  4. By: Gianluca Orefice (University of Paris-Dauphine, CEPII and CESifo); Giovanni Peri (University of California, Davis and NBER)
    Abstract: The process of matching between firms and workers is an important mechanism in determining the distribution of wages. In a labor market characterised by large dispersion of workers' productivity and worker-firm complementarity, high quality firms have strong incentives to screen for the quality of workers. This process will increase the positive quality association of firm-worker matches known as positive assortative matching (PAM). Immigration in a local labor market, by increasing the variance of workers abilities, may drive stronger PAM between firms and workers. Using French matched employer-employee (DADS) data over the period 1995-2005 we document that positive supply-driven changes of immigrant workers in a district increased the strength of PAM. We then show that this association is consistent with causality, is quantitatively significant, and is associated with higher average productivity and firm profits, but also with higher wage dispersion. We also show that the increased degree of positive assortative matching is mainly reached by high-productive firms "losing" lower quality workers and "attracting" higher quality workers.
    Keywords: Matching, Workers, Firms, Immigration, Productivity.
    JEL: F16 J20 J61
    Date: 2020–03
  5. By: De Paola, Maria (University of Calabria); Lombardo, Rosetta (University of Calabria); Pupo, Valeria (University of Calabria); Scoppa, Vincenzo (University of Calabria)
    Abstract: Public speaking is an important skill for career prospects and for leadership positions, but many people tend to avoid it because it generates anxiety. We run a field experiment to analyze whether in an incentivized setting men and women show differences in their willingness to speak in public. The experiment involved more than 500 undergraduate students who could gain two points to add to the final grade of their exam by orally presenting solutions to a problem set. Students were randomly assigned to present only to the instructor or in front of a large audience (a class of 100 or more). We find that while women are more willing to present face-to-face, they are considerably less likely to give a public presentation. Female aversion to public speaking does not depend on differences in ability, risk aversion, self-confidence and self-esteem. The aversion to public speaking greatly reduces for daughters of working women. From data obtained through an on-line Survey we also show that neither increasing the gains deriving from public speaking nor allowing participants more time to prepare enable to close the gender gap.
    Keywords: public speaking, psychological gender differences, gender, leadership, glass ceiling, field experiment
    JEL: D91 C93 M50
    Date: 2020–02
  6. By: Sebastian Heise; Tommaso Porzio
    Abstract: We develop a job ladder model with labor reallocation across firms and regions, and estimate it on matched employer-employee data to study the large and persistent real wage gap between East and West Germany. We find that the wage gap is mostly due to firms paying higher wages per efficiency unit in West Germany and quantify a rich set of frictions preventing worker reallocation across space and across firms. We find that three spatial barriers impede East Germans’ ability to migrate West: migration costs, a preference to live in the East, and fewer job opportunities received from the West. The estimated model highlights that the spatial barriers needed to generate the large wage gap between East and West are small relative to the frictions preventing the reallocation of labor across firms. Therefore, policies that directly promote regional integration lead to smaller aggregate benefits than equally costly hiring subsidies within region.
    Keywords: Labor mobility; Regional integration; Spatial wage gaps
    JEL: J60 O10 R10
    Date: 2019–12–23
  7. By: Fackler, Daniel; Hölscher, Lisa; Schnabel, Claus; Weyh, Antje
    Abstract: Using representative linked employer-employee data for Germany, this paper analyzes short- and long-run differences in labor market performance of workers joining start-ups instead of incumbent firms. Applying entropy balancing and following individuals over ten years, we find huge and long-lasting drawbacks from entering a start-up in terms of wages, yearly income, and (un)employment. These disadvantages hold for all groups of workers and types of start-ups analyzed. Although our analysis of different subsequent career paths highlights important heterogeneities, it does not reveal any strategy through which workers joining start-ups can catch up with the income of similar workers entering incumbent firms.
    Keywords: startups,young firms,wages,linked employer-employee data
    JEL: J31 J63 L26 M51
    Date: 2020
  8. By: Johanna Catherine Maclean; Stefan Pichler; Nicolas R. Ziebarth
    Abstract: This paper evaluates the labor market effects of sick pay mandates in the United States. Using the National Compensation Survey and difference-in-differences models, we estimate their impact on coverage rates, sick leave use, labor costs, and non-mandated fringe benefits. Sick pay mandates increase coverage significantly by 13 percentage points from a baseline level of 66%. Newly covered employees take two additional sick days per year. We find little evidence that mandating sick pay crowds-out other non-mandated fringe benefits. We then develop a model of optimal sick pay provision along with a welfare analysis. Mandating sick pay likely increases welfare.
    JEL: I12 I13 I18 J22 J28 J32
    Date: 2020–03
  9. By: Yueran Ma; Tiziano Ropele; David Sraer; David Thesmar
    Abstract: This paper quantifies the economic costs of distortions in managerial forecasts. We match a unique managerial survey run by the Bank of Italy with administrative data on firm balance sheets and income statements. The resulting dataset allows us to observe a long panel of managerial forecast errors for a sample of firms representative of the Italian economy. We show that managerial forecast errors are positively and significantly autocorrelated. This persistence in forecast error is consistent with managerial underreaction to new information. To quantify the economic significance of this forecasting bias, we estimate a dynamic equilibrium model with heterogeneous firms and distorted expectations. The estimated model matches not only the persistence of forecast errors, but the empirical link between investment and managerial forecasts. Relative to a counterfactual with rational expectations, we find that managers exhibit large forecasting biases, which lead to significant distortions in firm-level investment. These distortions, however, imply limited loss in firm value. In general equilibrium, the estimated model leads to negligible aggregate efficiency losses from distorted forecasts.
    JEL: E03 E22 G02 G3 G31
    Date: 2020–03

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