nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2020‒05‒25
four papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Tournament incentives, age diversity and firm performance By Oleksandr Talavera; Shuxing Yin; Mao Zhang
  2. Recruitment strategies and match quality - New evidence from representative linked employer-employee data By Brändle, Tobias; Grunau, Philipp; Haylock, Michael; Kampkötter, Patrick
  3. Gender Differences in Professional Career Dynamics: New Evidence from a Global Law Firm By Ina Ganguli; Ricardo Hausmann; Martina Viarengo
  4. Vacancies, Employment Outcomes and Firm Growth: Evidence from Denmark By Jesper Bagger; Francois Fontaine; Manolis Galenianos; Ija Trapeznikova

  1. By: Oleksandr Talavera (University of Birmingham); Shuxing Yin (University of Sheffield); Mao Zhang (University of St Andrews)
    Abstract: This study introduces a new dimension, age diversity of non-CEO executives, which moderates the relationship between promotion-based tournament incentives, measured as the pay gap between the CEO and non-CEO executives, and firm performance. For a sample of Chinese listed firms from 2005 to 2015, we find that the tournament incentives for non-CEO executives relate positively to firm performance. This relationship is weaker when non-CEO executives are from different age cohorts, whereas the tournament effect is enhanced when non-CEO executives are from the same age cohort. The negative moderation effect of age diversity is more pronounced in state firms and in the Northern China Plain cultural region. The negative moderation effect disappears in firms with CEOs who have overseas experience. We reason that the peer pressure among the similar-aged non-CEO executives enhances the tournament competition and that age hierarchy reduces incentives for younger executives to compete. Our findings have important implications for firms not only in China, but also in countries and regions where seniority is highly valued when setting executive compensation and optimizing organizational structure.
    Keywords: Executive compensation; Tournament effect; Non-CEO executives; Age diversity; Seniority
    JEL: G30 J10 J33
    Date: 2020–05
  2. By: Brändle, Tobias; Grunau, Philipp; Haylock, Michael; Kampkötter, Patrick
    Abstract: In economics, the recruitment process of firms is largely treated as a black box. To shed light on this process, we use new representative linked employer-employee data for German private-sector establishments to explore search, selection and screening activities over the years 2012-2018. We document longitudinal changes in hiring policies and address the heterogeneity across establishments relating to size, ownership, sector, and unobserved heterogeneity. Firms' recruitment strategies have sizeable effects on the composition of worker productivity, worker-firm match quality, the number of open vacancies, as well as expected staffing problems. Finally, we outline potential mechanisms and research gaps for future work, where there is room for more detailed and causal evidence.
    Keywords: Recruitment,Hiring Policies,Linked Employer-Employee Data,Worker Productivity,Vacancies,Match Quality
    JEL: J21 J63 M51
    Date: 2020
  3. By: Ina Ganguli; Ricardo Hausmann; Martina Viarengo
    Abstract: We examine gender gaps in career dynamics in the legal sector using rich panel data from one of the largest global law firms in the world. The law firm studied is representative of multinational law firms and operates in 23 countries. The sample includes countries at different stages of development. We document the cross-country variation in gender gaps and how these gaps have changed over time. We show that while there is gender parity at the entry level in most countries by the end of the period examined, there are persistent raw gender gaps at the top of the organization across all countries. We observe significant heterogeneity among countries in terms of gender gaps in promotions and wages, but the gaps that exist appear to be declining over the period studied. We also observe that women are more likely to report exiting the firm for family and work-life balance reasons, while men report leaving for career advancement. Finally, we show that various measures of national institutions and culture appear to play a role in the differential labor-market outcomes of men and women.
    Keywords: gender gaps, human capital, job mobility, promotion, culture, legal sector
    JEL: I26 J16 J62 M51 Z10
    Date: 2020
  4. By: Jesper Bagger (Royal Holloway, University of London and Dale T. Mortensen Centre, Aarhus University); Francois Fontaine (Paris School of Economics, Universite Paris 1-Pantheon Sorbonne); Manolis Galenianos (Royal Holloway, University of London); Ija Trapeznikova (Royal Holloway, University of London)
    Abstract: We use a comprehensive dataset from Denmark that combines online job advertisements with a matched employer-employee dataset and a firm-level dataset with value added and revenue information to study the relationship between vacancy-posting and various firm outcomes. We find that posting a vacancy significantly increases a firm's hiring rate, and that two-third of the additional hiring occurs in the same quarter while one-third occurs with one quarter lag. The majority of the effect is accounted for by hiring from employment. Small and slow-growth firms show greater hiring responses and the hiring response of high-productivity firms takes longer to materialize. We find that separations that are likely associated with quits predict vacancy posting, consistent with replacement hiring and vacancy chains. Growth in value added and revenue has a strong positive effect on vacancy posting but only when shocks are permanent - transitory shocks do not affect vacancy posting.
    Keywords: Vacancies, hiring, separations, employment growth, firm growth, value added, revenue
    JEL: J23 J63
    Date: 2020–05–15

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