nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2023‒01‒23
ten papers chosen by
Patrick Kampkötter
Eberhard Karls Universität Tübingen

  1. Performance Pay in Insurance Markets: Evidence from Medicare By Michele Fioretti; Hongming Wang
  2. Diversity and Team Performance in a Kenyan Organization By Benjamin Marx; Vincent Pons; Tavneet Suri
  3. Workplace Presenteeism, Job Substitutability and Gender Inequality By Ghazala Azmat; Lena Hensvik; Olof Rosenqvist
  4. Employers' Associations, Worker Mobility, and Training By Martins, Pedro S.; Thomas, Jonathan P.
  5. Common Ownership, Competition, and Top Management Incentives By Miguel Anton; Florian Ederer; Mireia Gine; Martin C. Schmalz
  6. The Anatomy of Sorting - Evidence from Danish Data By Rasmus Lentz; Suphanit Piyapromdee; Jean-Marc Robin
  7. Keep Calm and Carry On: The Short- vs. Long-Run Effects of Mindfulness Meditation on (Academic) Performance By Kasser, Lea; Fischer, Mira; Valero, Vanessa
  8. Is There an Ethnic Pay Gap in Germany? Evidence from a Representative Sample of the Adult Population By Ayaita, Adam
  9. Does Performance Pay Enhance Social Accountability? Evidence from Remote Schools in Indonesia By Arya Gaduh; Menno Pradhan; Jan Priebe; Dewi Susanti
  10. Betting on Diversity – Occupational Segregation and Gender Stereotypes By Fischbacher, Urs; Kübler, Dorothea; Stüber, Robert

  1. By: Michele Fioretti (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Hongming Wang
    Abstract: Public procurement bodies increasingly resort to pay-for-performance contracts to promote efficient spending. We show that firm responses to pay-for-performance can widen the inequality in accessing social services. Focusing on the quality bonus payment initiative in Medicare Advantage, we find that higher quality-rated insurers responded to bonus payments by selecting healthier enrollees with premium differences across counties. Selection is profitable because the quality rating fails to adjust for differences in enrollee health. Selection inflated the bonus payments and shifted the supply of highrated insurance to the healthiest counties, reducing access to lower-priced, higher-rated insurance in the riskiest counties.
    Keywords: pay-for-performance, Medicare Advantage, risk selection, quality ratings, health insurance access
    Date: 2021–10–15
  2. By: Benjamin Marx (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Vincent Pons (Harvard Business School - Harvard University [Cambridge]); Tavneet Suri (MIT Sloan - Sloan School of Management - MIT - Massachusetts Institute of Technology)
    Abstract: We present the results from a field experiment on team diversity. Individuals working as door-to-door canvassers for a non-profit organization were randomly assigned a teammate, a supervisor, and a list of individuals to canvass. This created random variation within teams in the degree of horizontal diversity (between teammates), vertical diversity (between teammates and their supervisor) and external diversity (between teams and the individuals they canvassed). We observe team-level measures of performance and find that horizontal ethnic diversity decreases performance, while vertical diversity often improves performance, and external diversity has no effect. The data on time use suggests that horizontally homogeneous teams organized tasks in a more efficient way, while vertically homogeneous teams exerted lower effort.
    Keywords: Ethnic diversity,Organizational behavior,Labor management,Performance
    Date: 2021–05
  3. By: Ghazala Azmat (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEP - LSE - Centre for Economic Performance - LSE - London School of Economics and Political Science); Lena Hensvik (Uppsala University); Olof Rosenqvist (IFAU - The Institute for Evaluation of Labour Market and Education Policy)
    Abstract: Following the arrival of the first child, women's absence rates soar and become less predictable. This fall in workplace presenteeism harms women's wages, especially in jobs with low substitutability. Although both presenteeism and job uniqueness are rewarded, we document that women's likelihood of holding jobs with low substitutability decreases relative to men's after childbearing. This gap persists, with important long-run wage implications. We highlight that the parenthood wage penalty for women could be reduced by organizing work so that more employees have tasks that can be performed satisfactorily by other employees in the workplace.
    Keywords: Work absence, Job substitutability, Gender wage inequality
    Date: 2021–11
  4. By: Martins, Pedro S.; Thomas, Jonathan P.
    Abstract: This paper studies firm-provided training in a context of potential worker mobility. We argue that such worker mobility may be reduced by employers' associations (EAs) through no-poach agreements. First, we sketch a simple model to illustrate the impact of employer coordination on training. We then present supporting evidence from rich matched panel data, including firms' EA affiliation and workers' individual training levels. We find that workers' mobility between firms in the same EA is considerably lower than mobility between equivalent firms not in the same EA. We also find that training provision by EA firms is considerably higher, even when drawing on within-employee variation and considering multiple dimensions of training. We argue that these results are consistent with a role played by EAs in reducing worker mobility.
    Keywords: Employers organisations, No-poach agreements, Worker mobility
    JEL: J53 J62 L40
    Date: 2023
  5. By: Miguel Anton; Florian Ederer; Mireia Gine; Martin C. Schmalz
    Abstract: We present a mechanism based on managerial incentives through which common ownership affects product market outcomes. Firm-level variation in common ownership causes variation in managerial incentives and productivity across firms, which leads to intra-industry and intra-firm cross-market variation in prices, output, markups, and market shares that is consistent with empirical evidence. The organizational structure of multiproduct firms and the passivity of common owners determine whether higher prices under common ownership result from higher costs or from higher markups. Using panel regressions and a difference-in-differences design we document that managerial incentives are less performance-sensitive in firms with more common ownership.
    JEL: D21 G32 J33 L13 L21 M12
    Date: 2022–12
  6. By: Rasmus Lentz (University of Wisconsin-Madison); Suphanit Piyapromdee (UCL - University College of London [London]); Jean-Marc Robin (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, UCL - University College of London [London])
    Abstract: In this paper, we formulate and estimate a flexible model of job mobility and wages with two-sided heterogeneity. The analysis extends the finite mixture approach of Bonhomme et al. (2019) and Abowd et al. (2019) to develop a new Classification Expectation-Maximization algorithm that ensures both worker and firm latent type identification uses wage and mobility variations in the data. Workers receive job offers in worker type segmented labor markets. Offers are accepted according to a logit form that compares the value of the current job with that of the new job. In combination with flexibly estimated layoff and job finding rates, the analysis quantifies the four different sources of sorting: preferences (job values), segmentation, layoffs, and job finding. Job preferences are identified through jobto-job moves in a revealed preference argument. They are in the model structurally independent from the identified job wages, possibly as a reflection of the presence of amenities. We find evidence of a strong pecuniary motive in job preferences. While, the correlation between preferences and current job wages is positive, the net present value of the future earnings stream given the current job correlates much more strongly with preferences for it. This is more so for short than long tenure workers. In the analysis, we distinguish between type sorting and wage sorting. Type sorting is quantified by means of the mutual information index. Wage sorting is captured through correlation between identified wage types. While layoffs are less important than the other channels, we find all channels to contribute substantially to sorting. In early career, job arrival processes are the key determinant of both types of sorting, whereas the role of job preferences becomes increasingly important as cohorts age. Over the life cycle, job preferences intensify, type sorting increases and pecuniary considerations wane.
    Keywords: Heterogeneity, Wage distributions, Employment and job mobility, Mutual information, Finite mixtures, EM algorithm, Classification algorithm, Sorting, Decomposition of wage inequality
    Date: 2022–10–11
  7. By: Kasser, Lea (University of Regensburg, CESifo and CEPR); Fischer, Mira (WZB Berlin and IZA); Valero, Vanessa (Loughborough University and CeDEx)
    Abstract: Mindfulness-based meditation practices are becoming increasingly popular in Western societies, including in the business world and in education. While the scientific literature has largely documented the benefits of mindfulness meditation for mental health, little is still known about potential spillovers of these practices on other important life outcomes, such as performance. We address this question through a field experiment in an educational setting. We study the causal impact of mindfulness meditation on academic performance through a randomized evaluation of a well-known 8-week mindfulness meditation training delivered to university students on campus. As expected, the intervention improves students' mental health and non-cognitive skills. However, it takes time before students' performance can benefit from mindfulness meditation: we find that, if anything, the intervention marginally decreases average grades in the short run, i.e., during the exam period right after the end of the intervention, whereas it significantly increases academic performance, by about 0.4 standard deviations, in the long run (ca. 6 months after the end of intervention). We investigate the underlying mechanisms and discuss the implications of our results.
    Keywords: performance; mental health; education; meditation; field experiment;
    JEL: I21 C93 I12 I31
    Date: 2022–11–11
  8. By: Ayaita, Adam
    Abstract: This study investigates a disparity in hourly wages (i.e., a pay gap) between employees with an ethnic minority vs. ethnic majority background in Germany. To this aim, a Blinder-Oaxaca decomposition based on a representative survey of the adult population in Germany is used. The analysis is restricted to employees who completed secondary schooling in Germany (N = 9, 304). The results show that, overall, ethnic minority employees receive significantly lower gross hourly wages than ethnic majority employees, and this difference amounts to 13.8%. The larger part of this gap is explained by group differences in demographic, human capital, and occupational characteristics—in particular, education level, work experience, job tenure, the precise employment status, and occupational status. However, there is also a significant unexplained pay gap that amounts to 2.7% lower wages for ethnic minority (vs. ethnic majority) employees, indicating potential wage discrimination against ethnic minority employees. The total, explained, and unexplained ethnic pay gaps appear to be somewhat larger among men than among women. Finally, an exploratory analysis suggests that the part of the ethnic pay gap that has remained unexplained might be largely explained by whether employees hold the German citizenship and whether they were born in Germany.
    Keywords: discrimination, ethnic background, ethnicity, Germany, pay gap, wages
    JEL: J24 J31 J38 J71
    Date: 2023
  9. By: Arya Gaduh; Menno Pradhan; Jan Priebe; Dewi Susanti
    Abstract: Social accountability offers a viable alternative to top-down supervision of service delivery in remote areas when travel cost renders the latter ineffective. However, this bottom-up approach may not be effective when the community has weak authority relative to the service provider. This paper investigates whether giving communities authority over teacher performance pay improves the effectiveness of social accountability in Indonesia’s remote schools. We tested incentive contracts based on either camera-verified teacher presence or community ratings of teacher performance. Social accountability had the strongest and most persistent impact on student learning when combined with the former. The results indicate that when the principal (community) has weak authority vis-à-vis the agent (regular teachers), increasing that authority using an incomplete but verifiable contract works better than using a more comprehensive but subjective one.
    JEL: H52 I21 I25 I28 O15
    Date: 2022–12
  10. By: Fischbacher, Urs (Universität Konstanz); Kübler, Dorothea (WZB Berlin, TU Berlin and CESifo); Stüber, Robert (NYU Abu Dhabi)
    Abstract: Many occupations and industries are highly segregated with respect to gender. This segregation could be due to perceived job-specific productivity differences between men and women. It could also result from the belief that single-gender teams perform better. We investigate the two explanations in a lab experiment with students and in an online experiment with personnel managers. The subjects bet on the productivity of teams of different gender compositions in tasks that differ with respect to gender stereotypes. We obtain similar results in both samples. Women are picked more often for the stereotypically female task and men more often for the stereotypically male task. Subjects do not believe that homogeneous teams perform better but bet more on diverse teams, especially in the task with complementarities. Elicited expectations about the bets of others reveal that subjects expect the effect of the gender stereotypes of tasks but underestimate others’ bets on diversity.
    Keywords: gender segregation; hiring decisions; teams; discrimination; stereotypes;
    JEL: D91 J16
    Date: 2022–12–27

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