nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2023‒09‒25
eight papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

  1. You Will not Regret it: On the Practice of Randomized Incentives By Brice Corgnet; Roberto Hernán González
  2. Female Leadership and Workplace Climate By Alan, Sule; Corekcioglu, Gozde; Kaba, Mustafa; Sutter, Matthias
  3. Industry Wage Differentials: A Firm-Based Approach By David Card; Jesse Rothstein; Moises Yi
  4. Performance Costs and Benefits of Collective Turnover: A Theory-Driven Measurement Framework and Applications By Zubanov, Nick; Shakina, Elena
  5. Worker productivity during Covid-19 and adaptation to working from home By Burdett, Ashley; Etheridge, Ben; Wang, Yikai; Tang, Li
  6. The Gender Pay Gap: Micro Sources and Macro Consequences By Morchio, Iacopo; Moser, Christian
  7. Do firing costs change wages of low- and high-educated workers differently? By Jhon Jair Gonzalez Pulgarin
  8. Job Levels and Wages By Christian Bayer; Moritz Kuhn

  1. By: Brice Corgnet (emlyon business school, GATE UMR 5824, F-69130 Ecully, France); Roberto Hernán González (CEREN EA 7477, Burgundy School of Business, Université Bourgogne Franche-Comté, Dijon, France)
    Abstract: Scholars have long emphasized the importance of setting specific goals and providing clear expectations as a key driver of work performance. Yet, a casual observation of actual compensation practices suggests otherwise. Using both lab and field experiments, we show that randomization of bonus targets and piece rates can lead to higher performance than the best-available deterministic scheme. Furthermore, this effect can be sustained over time. We show that part of this effect is explained by regret motives, which lead workers to exert extra effort to avoid missing out on potential pay.
    Keywords: Randomized incentives, bonuses and piece rates, regret, experiments
    JEL: C91 C93 D86 D91 M52
    Date: 2023
  2. By: Alan, Sule (European University Institute); Corekcioglu, Gozde (Kadir Has University); Kaba, Mustafa (Max Planck Institute for Research on Collective Goods); Sutter, Matthias (Max Planck Institute for Research on Collective Goods)
    Abstract: Using data from over 2, 000 professionals in 24 large corporations, we show that female leaders shape the relational culture in the workplace dierently than male leaders. Males form homophilic professional ties under male leadership, but female leadership disrupts this pattern, creating a less segregated workplace. Female leaders are more likely to establish professional support links with their subordinates. Under female leadership, female employees are less likely to quit their jobs but no more likely to get promoted. Our results suggest that increasing female presence in leadership positions may be an effective way to mitigate toxic relational culture in the workplace.
    Keywords: female leadership, workplace climate, social networks
    JEL: C93 J16 M14
    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 highpremium firms and high-skilled workers.
    Keywords: Industry wage differentials; AKM models; mover design
    JEL: J31 J62
    Date: 2023–08
  4. By: Zubanov, Nick (University of Konstanz); Shakina, Elena (University of Vigo)
    Abstract: Building on job matching theory, we model the effect of collective turnover on workplace performance as the total of its costs from operational disruptions and benefits from better job-worker match quality, each component varying with turnover level. The resulting theoretical turnover-performance relationship is generally curvilinear, nesting all the hitherto known patterns – linear, "U-shape" and "inverted U-shape" – as special cases, and lends itself to an empirically estimable regression model from which one can derive the implied costs and benefits of turnover. Applications to data from two retail firms reveal some benefits from turnover in one firm, and none in the other. Turnover costs exceed benefits in both firms.
    Keywords: employee turnover, performance
    JEL: J63
    Date: 2023–08
  5. By: Burdett, Ashley; Etheridge, Ben; Wang, Yikai; Tang, Li
    Abstract: We examine reported productivity changes of workers over the course of the Covid-19 pandemic, which we validate against external metrics. On average, workers report being at least as productive as before the pandemic’s onset. However, this average masks substantial heterogeneity, which is linked to job quality, gender, the presence of children, and ease of working from home. As the pandemic progressed, those who previously performed well at home were more likely to remain there. Building on these findings, we estimate factors affecting productivity outcomes across locations controlling for endogenous selection. We find that those in ‘good’ jobs (with managerial duties and working for large firms) were advantaged specifically in the home environment. More generally we find an effect of key personality traits – agreeableness and conscientiousness – on productivity outcomes across locations.
    Date: 2023–08–16
  6. By: Morchio, Iacopo (University of Bristol); Moser, Christian (Columbia University)
    Abstract: Using linked employer-employee data from Brazil, we document a large gender pay gap due to women working at lower-paying employers with better nonpay attributes. To interpret these facts, we develop an equilibrium search model with endogenous firm pay, amenities, and hiring. We provide a constructive proof of identification of all model parameters. The estimated model suggests that amenities are important for both men and women, that compensating differentials explain half of the gender pay gap, and that there are significant output and welfare gains from eliminating gender differences. However, equal-treatment policies fail to achieve those gains.
    Keywords: wage inequality, amenities, equilibrium search model, linked employer-employee data, compensating differentials, taste-based discrimination, monopsony power
    JEL: E24 J16 J31 J32
    Date: 2023–08
  7. By: Jhon Jair Gonzalez Pulgarin (Université du Maine)
    Abstract: Wages of highly educated workers are affected differently by firing taxes compared with wages of less educated workers. Using a variety of data sources, I evaluate the effects of increasing firing taxes across the United States on wages of high- and low-educated workers. In particular, I analyze how changes in the regulation of the employment-at-will across states affected the wages between 1970–1995. Application of quasiexperimental methods yields results suggesting a negative effect for low-educated workers and no significant effects for the highly educated. The standard search and matching model with endogenous search extended to account for two types of agents points as well to a negative effect of the firing costs on wages, with a more pronounced effect for low-educated workers.
    Date: 2023–08–11
  8. By: Christian Bayer; Moritz Kuhn
    Abstract: Job levels summarize the complexity, autonomy, and responsibility of task execution. Conceptually, job levels are related to the organization of production, are distinct from occupations, and can be constructed from data on task execution. We highlight their empirical role in matched employer-employee data for life-cycle wage dynamics, refine a task-based view of wage determination, and demonstrate that differences in job levels account for most of the observed wage differences. We also show, within a structural framework, that a job-level perspective provides a novel and fruitful interpretation of widely studied phenomena such as the gender wage gap and the returns to education and seniority.
    Keywords: Job levels, wage structure, career ladder
    JEL: D33 E24 J31
    Date: 2023

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