nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2022‒01‒17
six papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Non-Base Compensation and the Gender Pay Gap By Boris Hirsch; Philipp Lentge
  2. Hiring entrepreneurs for innovation By Louise Lindbjerg; Theodor Vladasel
  3. Wage Posting or Wage Bargaining? A Test Using Dual Jobholders By Marta Lachowska; Alexandre Mas; Raffaele D. Saggio; Stephen A. Woodbury
  4. Job Displacement and Sectoral Mobility By Osborne Jackson
  5. Worker Beliefs About Outside Options By Simon Jäger; Christopher Roth; Nina Roussille; Benjamin Schoefer
  6. Past Exposure to Macroeconomic Shocks and Populist Attitudes in Europe By Despina Gavresi; Anastasia Litina

  1. By: Boris Hirsch (Leuphana University of Luneburg, Halle Institute for Economic Research, and IZA Institute of Labor Economics,); Philipp Lentge (Leuphana University of Lüneburg)
    Abstract: This paper investigates whether non-base compensation contributes to the gender pay gap. In wage decompositions, we find that lower bonus payments to women explain about 10% of the gap at the mean and at different quantiles of the unconditional wage distribution whereas the lower prevalence of shift premia and overtime pay among women is unimportant. Among managers, the contribution of bonuses to the mean gap more than doubles and is steadily rising as one moves up the wage distribution. Our findings suggest that gender di_erences in bonuses are an important contributor to the gender pay gap, particularly in top jobs.
    Keywords: gender pay gap, bonus payments, shift premia, overtime pay, glass ceilings
    JEL: J31 J71
    Date: 2021–07
  2. By: Louise Lindbjerg; Theodor Vladasel
    Abstract: Technical human capital improves firms' invention outcomes, but generating innovation revenue may require distinct skills in bringing new ideas to market. We argue that former founders are endowed with execution skills, a generalist ability to create and exploit market gaps by acquiring and mobilizing resources, so entrepreneurial human capital enhances innovation in established organizations. Combining register and Community Innovation Survey data from Denmark, we show that entrepreneur hires are associated with higher sales from new products and services. This result is driven by founder hires in middle management, a hierarchical position where broader decision rights and resource access increase execution skills' effectiveness. Founder hires are more tightly linked to innovation new to the firm or market, rather than world, consistent with our prediction that execution skills help bring incremental improvements to market, but do not necessarily generate radical innovation. Together, our findings suggest that entrepreneurial human capital may help firms appropriate a larger share of the value their knowledge generates.
    Keywords: innovation, learning by hiring, entrepreneurship, execution skills, human capital, middle management
    JEL: J24 L23 M12 M21 M51
    Date: 2021–12
  3. By: Marta Lachowska (W.E. Upjohn Institute for Employment Research); Alexandre Mas (Princeton University and NBER); Raffaele D. Saggio (University of British Colombia and NBER); Stephen A. Woodbury (Michigan State University and W.E. Upjohn Institute for Employment Research)
    Abstract: This paper examines the behavior of dual jobholders to test a simple model of wage bargaining and wage posting. We estimate the sensitivity of wages and separation rates to wage shocks in a worker’s secondary job to assess the degree of bargaining versus wage posting in the labor market. We interpret the evidence within a model where workers facing hours constraints in their primary job may take a second, flexible-hours job for additional income. When a secondary job offers a sufficiently high wage, a worker either bargains with the primary employer for a wage increase or separates. The model provides a number of predictions that we test using matched employer-employee administrative data from Washington State. In the aggregate, wage bargaining appears to be a limited determinant of wage setting. The estimated wage response to improved outside options, which we interpret as bargaining, is precisely estimated, but qualitatively small. Wage posting appears to be more important than bargaining for wage determination overall, and especially in lower parts of the wage distribution. Observed wage bargaining takes place mainly among workers in the highest wage quartile. For this group, improved outside options translate to higher wages, but not higher separation rates. In contrast, for workers in the lowest wage quartile, wage increases in the secondary job lead to higher separation rates but no significant wage increase in the primary job, consistent with wage posting. We also find evidence in support of the hours-constraint model for dual jobholding. In particular, work hours in the primary job do not respond to wages in the secondary job, but hours and separations in the secondary job are sensitive to wages in the primary job due to income effects.
    Keywords: wage bargaining, wage posting, dual jobholders, employer-employee, secondary jobs, work hours
    JEL: C78 J31 J33 J41
    Date: 2022–01
  4. By: Osborne Jackson
    Abstract: This paper combines two components of the US Current Population Survey to characterize the relationship between job displacement and sectoral mobility for long-tenured workers over the 1996–2019 period: (1) the cross-sectional Displaced Worker Survey and (2) the 16-month longitudinal design of the Basic Monthly Survey. While displacement negatively correlates with mobility over time, such job loss has a positive causal impact on mobility for displaced workers compared with similar non-displaced workers. Education and industry structure facilitate post-displacement industry switching, and several factors, including business cycles, affect whether the alternative to sectoral mobility is likely to be same-industry employment or nonemployment.
    Keywords: Displaced Worker Survey; job displacement; sectoral mobility; Current Population Survey
    JEL: J24 J63
    Date: 2021–10–01
  5. By: Simon Jäger (MIT); Christopher Roth (University of Cologne); Nina Roussille (LSE); Benjamin Schoefer (UC Berkeley)
    Abstract: Workers wrongly anchor their beliefs about outside options on their current wage. In particular, low-paid workers underestimate wages elsewhere. We document this anchoring bias by eliciting workers’ beliefs in a representative survey in Germany and comparing them to measures of actual outside options in linked administrative labor market data. In an equilibrium model, such anchoring can give rise to monopsony and labor market segmentation. In line with the model, misperceptions are particularly pronounced among workers in low-wage firms. If workers had correct beliefs, at least 10% of jobs, concentrated in low-wage firms, would not be viable at current wages.
    Keywords: Beliefs, Outside Options, Information Frictions, Sorting
    JEL: D83 D84
    Date: 2022–01
  6. By: Despina Gavresi; Anastasia Litina
    Abstract: This paper explores the interplay between past exposure to macroeconomic shocks and populist attitudes. We document that individuals who experienced a macroeconomic shock during their impressionable years (between 18 and 25 years of age), are currently more prone to voting for populist parties, and manifest lower trust both in national and European institutions. We use data from the European Social Survey (ESS) to construct the differential individual exposure to macroeconomic shocks during impressionable years. Our findings suggest that it is not only current exposure to shocks that matters (see e.g., Guiso et al. (2020)) but also past exposure to economic recessions, which has a persistent positive effect on the rise of populism. Interestingly, the interplay between the two, i.e., past and current exposure to economic shocks, has a mitigating effect on the rise of populism. Individuals who were exposed to economic shocks in the past are less likely to manifest populist attitudes when faced with a current crisis, as suggested by the experience-based learning literature.
    Keywords: macroeconomic shocks, trust, attitudes, populism
    JEL: D72 E60 F68 P16 Z13
    Date: 2021

This nep-hrm issue is ©2022 by Patrick Kampkötter. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.