nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2022‒06‒20
ten papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Pay, productivity and management By Nicholas Bloom; Scott W. Ohlmacher; Cristina J. Tello-Trillo; Melanie Wallskog
  2. Setting Adequate Wages for Workers: Managers' Work Experience, Incentive Scheme and Gender Matter By David Huber; Leonie Kühl; Nora Szech
  3. Communication within firms: evidence from CEO turnovers By Stephen Michael Impink; Andrea Prat; Raffaella Sadun
  4. Overwhelmed by Routine Tasks: A Multi-Tasking Principle Agent Perspective By Dominique Demougin; Carsten Helm
  5. Skill Mismatch and the Costs of Job Displacement By Frank Neffke; Ljubica Nedelkoska; Simon Wiederhold
  6. Do well managed firms make better forecasts? By Nicholas Bloom; Takafumi Kawakubo; Charlotte Meng; Paul Mizen; Rebecca Riley; Tatsuro Senga; John Van Reenen
  7. The demand for executive skills By Joe Fuller; Stephen Hansen; Tejas Ramdas; Raffaella Sadun
  8. Working during non-standard work time undermines intrinsic motivation By Giurge, Laura M.; Woolley, Kaitlin
  9. Gender Differences in Response to Competitive Organization? Differences Across Fields from a Product Development Platform Field Experiment By Kevin Boudreau; Nilam Kaushik
  10. Worker stress, burnout, and wellbeing before and during the COVID-19 restrictions in the United Kingdom By Pelly, Diane; Daly, Michael; Delaney, Liam; Doyle, Orla

  1. By: Nicholas Bloom; Scott W. Ohlmacher; Cristina J. Tello-Trillo; Melanie Wallskog
    Abstract: Using confidential Census matched employer-employee earnings data we find that employees at more productive firms, and firms with more structured management practices, have substantially higher pay, both on average and across every percentile of the pay distribution. This pay-performance relationship is particularly strong amongst higher paid employees, with a doubling of firm productivity associated with 11% more pay for the highest-paid employee (likely the CEO) compared to 4.7% for the median worker. This pay-performance link holds in public and private firms, although it is almost twice as strong in public firms for the highest-paid employees. Top pay volatility is also strongly related to productivity and structured management, suggesting this performance-pay relationship arises from more aggressive monitoring and incentive practices for top earners.
    Keywords: Productivity
    Date: 2022–12
  2. By: David Huber; Leonie Kühl; Nora Szech
    Abstract: Many societies report an increasingly divergent development of managers’ salaries compared to that of their workforce. Moreover, there is often a lack in diversity amongst managerial boards. We investigate the role of managers’ gender and incentive scheme on wages chosen for workers by conducting two experimental studies. The data reveal male managers respond in more self-oriented ways to their incentive scheme. Further, we find that experience with the workers’ task can increase appreciation of workers. Effects are strongest when the managers’ compensation scheme rules out self-orientation. Overall, female managers display more consistency in choosing adequate wages for workers, i.e. their choices are less affected by incentives. An increase in diversity may thus help reducing salary disparities and foster work atmosphere.
    Keywords: adequate wages, real work experiment, gender
    JEL: D01 J16
    Date: 2022
  3. By: Stephen Michael Impink; Andrea Prat; Raffaella Sadun
    Abstract: This paper uses novel, firm-level measures derived from communications metadata before and after a CEO transition in 102 firms to study if CEO turnover impacts employees' communication flows. We find that CEO turnover leads to an initial decrease in intra-firm communication, followed by a significant increase approximately five months after the CEO change. The increase is driven primarily by vertical (i.e. manager to employee) communication. Greater increases in communication after CEO change are associated with greater increases in firm market returns.
    Keywords: CEO change, communication, alignment
    Date: 2021–09–08
  4. By: Dominique Demougin; Carsten Helm
    Abstract: We analyze a multitasking model with a verifiable routine task and a skill-dependent activity characterized by moral hazard. Contracts negotiated by firm/employee pairs follow from Nash bargaining. High- and low-skilled employees specialize, intermediate productivity employees perform both tasks. Compared to the efficient solution, more employees exert both tasks and effort in the routine task is inefficiently large. As work overload in the routine task is decoupled from a corresponding increase in remuneration, employees perceive a loss of control to allocate effort between the two tasks. Reductions in employees’ bargaining power and improvements in monitoring technologies aggravate the issue.
    Keywords: multi-tasking, work overload, routine tasks, rent extraction, moral hazard, limited liability, Nash Bargaining
    JEL: D82 D86 J41 M52
    Date: 2022
  5. By: Frank Neffke (Center for International Development at Harvard University); Ljubica Nedelkoska (Center for International Development at Harvard University); Simon Wiederhold
    Abstract: When workers are displaced from their jobs in mass layoffs or firm closures, they experience lasting adverse labor market consequences. We study how these consequences vary with the amount of skill mismatch that workers experience when returning to the labor market. Using novel measures of skill redundancy and skill shortage, we analyze individuals’ work histories in Germany between 1975 and 2010. We estimate difference-in-differences models, using a sample in which we match displaced workers to statistically similar non-displaced workers. We find that displacements increase the probability of occupational change eleven fold, and that the type of skill mismatch after displacement is strongly associated with the magnitude of post-displacement earnings losses. Whereas skill shortages are associated with relatively quick returns to the counterfactual earnings trajectories that displaced workers would have experienced absent displacement, skill redundancy sets displaced workers on paths with permanently lower earnings.
    Keywords: job displacement, human capital, skill mismatch, occupational change
    JEL: J24 J31 J63 J65
    Date: 2022–04
  6. By: Nicholas Bloom; Takafumi Kawakubo; Charlotte Meng; Paul Mizen; Rebecca Riley; Tatsuro Senga; John Van Reenen
    Abstract: We link a new UK management survey covering 8,000 firms to panel data on productivity in manufacturing and services. There is a large variation in management practices, which are highly correlated with productivity, profitability and size. Uniquely, the survey collects firms' micro forecasts of their own sales and also macro forecasts of GDP. We find that better managed firms make more accurate micro and macro forecasts, even after controlling for their size, age, industry and many other factors. We also show better managed firms appear aware that their forecasts are more accurate, with lower subjective uncertainty around central values. These stylized facts suggest that one reason for the superior performance of better managed firms is that they knowingly make more accurate forecasts, enabling them to make superior operational and strategic choices.
    Keywords: management, productivity, expectations, forecasting
    Date: 2022–12
  7. By: Joe Fuller; Stephen Hansen; Tejas Ramdas; Raffaella Sadun
    Abstract: We use a unique corpus of job descriptions for C-suite positions to document skills requirements in top managerial occupations across a large sample of firms. A novel algorithm maps the text of each executive search into six separate skill clusters reflecting cognitive, interpersonal, and operational dimensions. The data show an increasing relevance of social skills in top managerial occupations, and a greater emphasis on social skills in larger and more information intensive organizations. The results suggest the need for training, search and governance mechanisms able to facilitate the match between firms and top executives along multiple and imperfectly observable skills.
    Keywords: job descriptions, skills requirements, C-suite positions
    Date: 2021–09–08
  8. By: Giurge, Laura M.; Woolley, Kaitlin
    Abstract: How do people’s perceptions about when they work affect their intrinsic motivation? We find that working during non-standard work time (weekends/holidays) versus standard work time (Monday-Friday, 9-to-5) undermines people’s intrinsic motivation for their professional and academic pursuits. Working during non-standard work time decreases intrinsic motivation by causing people to consider better uses of their time. That is, people generate more upward counterfactual thoughts, which mediates the effect of work time on reduced intrinsic motivation. As a causal test of this process, increasing consideration of upward counterfactuals during standard work time reduces intrinsic motivation, whereas decreasing consideration of upward counterfactuals during non-standard work time helps employees and students maintain intrinsic motivation for their professional and academic pursuits. Overall, we identify a novel determinant of intrinsic motivation and address a real challenge many people face: How changing work schedules affect interest and enjoyment of work, with important consequences for work outcomes.
    Keywords: Elsevier deal
    JEL: R14 J01
    Date: 2022–05–01
  9. By: Kevin Boudreau; Nilam Kaushik
    Abstract: Prior research, primarily based on lab experiments, suggests that females might be more averse to competition than males and could be more inclined towards collaboration, instead. Were these findings to generalize to adults across the workforce, there could be profound implications for organizational design and personnel management. We report on a field experiment in which 97,678 adults from a wide range of fields and ages were invited to join a product development opportunity. Individuals were randomly assigned to treatments framing the opportunity as either involving competitive or collaborative interactions with other participants. Among those outside of science, technology, engineering, and math fields (STEM), we find significant gender differences in willingness to participate under competition. Among those in STEM fields, we detect no statistical gender differences. These results and broader patterns documented in the study are consistent with significant heterogeneity in competitiveness across both men and women, with field and career sorting resulting in differences (in gender differences) across fields.
    JEL: D02 D03 D9 D91 J0 J01 J2 M0 M12 M5 O3 O31 O32 O36
    Date: 2022–05
  10. By: Pelly, Diane; Daly, Michael; Delaney, Liam; Doyle, Orla
    Abstract: COVID-19 created a transformational shift in the working environment for much of the labour force, yet its impact on workers is unclear. This study uses longitudinal data to examine the wellbeing of 621 full-time workers assessed before (November 2019–February 2020) and during (May–June 2020) the first lockdown in the United Kingdom. We employ fixed effects analyses to investigate the impact of the restrictions and mandatory homeworking on cognitive, emotional, and psychological wellbeing. Within the sample, the rate of full-time homeworking increased from 2 to 74% between waves. We identify significant changes in 9 of the 15 measures assessed, with a general pattern of improvements in wellbeing during lockdown. Overall levels of stress, self-rated mental health, positive emotions and life and job satisfaction are not adversely affected by the restrictions. There is a reduction in the burnout symptoms of disengagement (−0.13 sd) and exhaustion (−0.20 sd) and in the frequency with which negative emotions are experienced at work (−0.15 sd). Workers feel more autonomous (+0.09 sd), closer to their co-workers (+0.10 sd), and more attached to their organisations (+0.19 sd). However, homelife satisfaction declines (−0.11 sd). These findings highlight the possibility that the COVID-19 pandemic and large-scale transition to homeworking was associated with unchanged or improved worker wellbeing. This study has important implications for governments and employers regarding a global shift to homeworking.
    Keywords: burnout; COVID-19 restrictions; homeworking; lockdown; mental health; stress; subjective wellbeing
    JEL: R14 J01
    Date: 2022–04–05

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