nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2023‒09‒18
eight papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

  1. Personality and physician performance pay: Evidence from a behavioral experiment in health By Groß, Mona; Hennig-Schmidt, Heike; Wiesen, Daniel
  2. Non-monetary Interventions, Workforce Retention and Hospital Quality: Evidence from the English NHS By Moscelli, Giuseppe; Sayli, Melisa; Blanden, Jo; Mello, Marco; Castro-Pires, Henrique; Bojke, Chris
  3. Industry Wage Differentials: A Firm-Based Approach By David Card; Jesse Rothstein; Moises Yi
  4. The Gender Gap in Claiming Credit for Teamwork By Klara Kinnl; Jakob Möller; Anna Walter
  5. Location, Location, Location By David Card; Jesse Rothstein; Moises Yi
  6. Vacancy Duration and Wages By Bassier, Ihsaan; Manning, Alan; Petrongolo, Barbara
  7. Labour Supply and Firm Size By Lin Shao; Faisal Sohail; Emircan Yurdagul
  8. The Search for Good Jobs: Evidence from a Six-year Field Experiment in Uganda By Oriana Bandiera; Vittorio Bassi; Robin Burgess; Imran Rasul; Munshi Sulaiman; Anna Vitali

  1. By: Groß, Mona (Department of Health Care Management, University of Cologne, Germany); Hennig-Schmidt, Heike (Department of Economics, University of Bonn, Germany Departement of Health Economics and Health Management, University of Oslo, Norway); Wiesen, Daniel (Department of Health Care Management, University of Cologne, Germany)
    Abstract: We study how the heterogeneity in responses to performance pay can be explained by personality traits. We utilize data from behavioral experiments and surveys on personality traits with physicians, medical students, and non-medical students. Performance pay is introduced at a within-subject level and complements either fee-for-service or capitation. We find that the payment system matters regarding the behavioral impact of personality traits. More conscientious and more agreeable individuals provide higher quality of care under capitation. Although performance pay further improves the quality, more conscientious and agreeable individuals respond less to capitation-based performance pay. Other personality traits are not behaviorally relevant. Under fee-for-service-based schemes, personality traits do not significantly related to individuals’ behavior. Our findings inform the incentive design for physicians and the potential sorting into incentive schemes based on personality traits.
    Keywords: Fee-for-service; capitation; blended pay for performance; personality traits; quality of care; heterogeneity
    JEL: C91 I11
    Date: 2023–09–07
  2. By: Moscelli, Giuseppe (University of Surrey); Sayli, Melisa (University of Surrey); Blanden, Jo (University of Surrey); Mello, Marco (University of Aberdeen); Castro-Pires, Henrique (University of Surrey); Bojke, Chris (University of Leeds)
    Abstract: Excessive turnover can signicantly impair an organization's performance. Using high-quality administrative data and staggered dierence-in-dierences strategies, we evaluate the impact of a programme that encouraged public hospitals to increase staff retention by providing data and guidelines on how to improve the non-pecuniary aspects of nursing jobs. We find that the programme has decreased the nurse turnover rate by 4.49%, decreased exits from the public hospital sector by 5.38%, and reduced mortality within 30 days from hospital admission by 3.45%, preventing 11, 400 deaths. Our results are consistent with a theoretical model in which information is provided to managers of multi-unit organizations, who trade off coordinating decisions across units and adapting them to local conditions.
    Keywords: labor supply, workforce retention, non-monetary incentives, hospital care, staggered difference-in-differences
    JEL: J32 J38 J45 J63 I11 C22
    Date: 2023–08
  3. By: David Card; Jesse Rothstein; Moises Yi
    Abstract: We revisit the estimation of industry wage differentials using linked employer-employee data from the U.S. LEHD program. Building on recent advances in the measurement of employer wage premiums, we define the industry wage effect as the employment-weighted average workplace premium in that industry. We show that cross-sectional estimates of industry differentials overstate the pay premiums due to unmeasured worker heterogeneity. Conversely, estimates based on industry movers understate the true premiums, due to unmeasured heterogeneity in pay premiums within industries. Industry movers who switch to higher-premium industries tend to leave firms in the origin sector that pay above-average premiums and move to firms in the destination sector with below-average premiums (and vice versa), attenuating the measured industry effects. Our preferred estimates reveal substantial heterogeneity in narrowly-defined industry premiums, with a standard deviation of 12%. On average, workers in higher-paying industries have higher observed and unobserved skills, widening between-industry wage inequality. There are also small but systematic differences in industry premiums across cities, with a wider distribution of pay premiums and more worker sorting in cities with more high-premium firms and high-skilled workers.
    JEL: J31 J62
    Date: 2023–08
  4. By: Klara Kinnl (Department of Economics, Vienna University of Economics and Business); Jakob Möller (Institute for Markets and Strategy, Vienna University of Economics and Business); Anna Walter (Institute for Markets and Strategy, Vienna University of Economics and Business; Institute for Advanced Studies Vienna)
    Abstract: We investigate gender differences in individual credit claiming for teamwork. In a large-scale online experiment, participants work on an interactive task in teams of two and subsequently report their subjective contribution to the teamwork. In three between-subject treatments, we incentivize participants to either i) state their beliefs about their contribution truthfully, ii) to exaggerate their contribution, or iii) to exaggerate and thereby harm the other team member. Our setup allows us to distinguish between overconfidence and exaggeration with and without negative externalities, and to test whether there is a gender gap in credit claiming. We find that men and women both equally overestimate their contributions, but men exaggerate more than women: As soon as there is an incentive to exaggerate, men claim to have contributed more than women, even when exaggeration harms the team member. This gender gap in credit claiming is particularly pronounced among very large claims and for high-contributors. Strategic misrepresentations of contributions to teamwork can thus have sizeable equity consequences on the labor market.
    Keywords: Experiment, Gender differences, Incentives, Team work, Overconfidence, Beliefs
    JEL: J16 C92 D9
    Date: 2023–08
  5. By: David Card; Jesse Rothstein; Moises Yi
    Abstract: We use data from the Longitudinal Employer-Household Dynamics program to study the causal effects of location on earnings. Starting from a model with employer and employee fixed effects, we estimate the average earnings premiums associated with jobs in different commuting zones (CZs) and different CZ-industry pairs. About half of the variation in mean wages across CZs is attributable to differences in worker ability (as measured by their fixed effects); the other half is attributable to place effects. We show that the place effects from a richly specified cross sectional wage model overstate the causal effects of place (due to unobserved worker ability), while those from a model that simply adds person fixed effects understate the causal effects (due to unobserved heterogeneity in the premiums paid by different firms in the same CZ). Local industry agglomerations are associated with higher wages, but overall differences in industry composition and in CZ-specific returns to industries explain only a small fraction of average place effects. Estimating separate place effects for college and non-college workers, we find that the college wage gap is bigger in larger and higher-wage places, but that two-thirds of this variation is attributable to differences in the relative skills of the two groups in different places. Most of the remaining variation reflects the enhanced sorting of more educated workers to higher-paying industries in larger and higher-wage CZs. Finally, we find that local housing costs at least fully offset local pay premiums, implying that workers who move to larger CZs have no higher net-of-housing consumption.
    JEL: J31 J61 R23
    Date: 2023–08
  6. By: Bassier, Ihsaan (London School of Economics); Manning, Alan (London School of Economics); Petrongolo, Barbara (University of Oxford)
    Abstract: We estimate the elasticity of vacancy duration with respect to posted wages, using data from the near-universe of online job adverts in the United Kingdom. Our research design identifies duration elasticities by leveraging firm-level wage policies that are plausibly exogenous to hiring difficulties on specific job vacancies, and control for job and market-level fixed-effects. Wage policies are defined based on external information on pay settlements, or on sharp, internally-defined, firm-level changes. In our preferred specifications, we estimate duration elasticities in the range −3 to −5, which are substantially larger than the few existing estimates.
    Keywords: vacancy duration, monopsony, wages
    JEL: J42 J63 J64
    Date: 2023–08
  7. By: Lin Shao; Faisal Sohail; Emircan Yurdagul
    Abstract: Larger firms feature i) longer hours worked, ii) higher wages, and iii) smaller (larger) wage penalties for working long (short) hours. We reconcile these patterns in a general equilibrium model, which features the endogenous interaction of hours, wages, and firm size. In the model, workers willing to work longer hours sort into larger firms that offer a wage premium. Complementarities in hours worked generate wage penalties that increase with the distance from the average firm hours. We use the model to argue about the importance of the interaction between hours, wages, and firm size on inequality.
    Keywords: Firm dynamics; Labour markets
    JEL: E24 J2 J31
    Date: 2023–08
  8. By: Oriana Bandiera; Vittorio Bassi; Robin Burgess; Imran Rasul; Munshi Sulaiman; Anna Vitali
    Abstract: There are 420 million young people in Africa today. Understanding how youth search for jobs and what affects their ability to find good jobs is of paramount importance. We do so using a field experiment tracking young job seekers for six years in Uganda's main cities. We examine how two standard labor market interventions impact their search for good jobs: vocational training, vocational training combined with matching youth to firms, and matching only. Training is offered in sectors with high quality firms. The matching intervention assigns workers for interviews with such firms. At baseline, unskilled youth are optimistic about their job prospects, especially over the job offer arrival rate from high quality firms. Those offered vocational training become even more optimistic, search more intensively and direct their search towards high quality firms. However, youth additionally offered matching become discouraged because call back rates from firm owners are far lower than their prior. As a result, they search less intensively and direct their search towards lower quality firms. These divergent expectations and search behaviors have persistent impacts: vocational trainees without match offers achieve greater labor market success, largely because they end up employed at higher quality firms than youth additionally offered matching. Our analysis highlights the foundational but separate roles of skills and expectations in job search, how interventions cause youth to become optimistic or discouraged, and how this matters for long run sorting and individual labor market outcomes.
    JEL: J64 O12
    Date: 2023–08

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