nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2023‒12‒11
nine papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

  1. Do management practices matter in further education? By Sandra McNally; Luis Schmidt; Anna Valero
  2. Low-wage jobs, foreign-born workers, and firm performance By Amuedo Dorantes, Catalina; Arenas-Arroyo, Esther; Mahajan, Parag; Schmidpeter, Bernhard
  3. Bonus Question: Does Flexible Incentive Pay Dampen Unemployment Dynamics? By Meghana Gaur; John Grigsby; Jonathon Hazell; Abdoulaye Ndiaye
  4. The Power of Proximity to Coworkers: Training for Tomorrow or Productivity Today? By Natalia Emanuel; Emma Harrington; Amanda Pallais
  5. Matching through Search Channels By Carlos Carrillo-Tudela; Leo Kaas; Benjamin Lochner
  6. Management and misallocation in Mexico By Nicholas Bloom; Leonardo Iacovone; Mariana Pereira-Lopez; John Van Reenen
  7. Digitalization: the edge of first movers By Cátia Cerqueira; Fernando Alexandre; Miguel Portela
  8. So, Dear Applicant, Do You Mean Working from Home or Shirking from Home? By Moens, Eline; Verhofstadt, Elsy; Van Ootegem, Luc; Baert, Stijn
  9. Female Leadership and Workplace Climate By Sule Alan; Gozde Corekcioglu; Mustafa Kaba; Matthias Sutter

  1. By: Sandra McNally; Luis Schmidt; Anna Valero
    Abstract: Further Education colleges are a key way in which 16-19 year olds acquire skills in the UK (much like US Community Colleges), especially those from low income backgrounds. Yet, little is known about what could improve performance in these institutions. We design and conduct the world's first management practices survey in these colleges (based on the World Management Survey) and match this to administrative longitudinal data on over 40, 000 students. Value added regressions with rich controls suggest that structured management matters for educational outcomes (e.g. upper secondary qualifications), especially for students from low-income backgrounds. In a hypothetical scenario where a learner is moved from a college at the 10th percentile of management practices to the 90th, this would be associated with 8% higher probability of achieving a good high school qualification, which is nearly half of the educational gap between those from poor and non-poor backgrounds. Hence, improving management practices may be an important channel for reducing inequalities.
    Keywords: management practices, further education
    Date: 2022–03–08
  2. By: Amuedo Dorantes, Catalina; Arenas-Arroyo, Esther; Mahajan, Parag; Schmidpeter, Bernhard
    Abstract: We examine how migrant workers impact firm performance using administrative data from the United States. Exploiting an unexpected change in firms' likelihood of securing low-wage workers through the H-2B visa program, we find limited crowd-out of other forms of employment and no impact on average pay at the firm. Yet, access to H-2B workers raises firms' annual revenues and survival likelihood. Our results are consistent with the notion that guest worker programs can help address labor shortages without inflicting large losses on incumbent workers.
    Keywords: Guest workers, migrants, employment, firm dynamics, H-2B visa
    JEL: J23 F22 J61
    Date: 2023
  3. By: Meghana Gaur (Princeton University); John Grigsby (Princeton University); Jonathon Hazell (London School of Economics and Political Science); Abdoulaye Ndiaye (New York University Stern)
    Abstract: We introduce dynamic incentive contracts into a model of unemployment dynamics and present three results. First, wage cyclicality from incentives does not dampen unemployment dynamics: the response of unemployment to shocks is first-order equivalent in an economy with flexible incentive pay and without bargaining, vis-Ã -vis an economy with rigid wages. Second, wage cyclicality from bargaining dampens unemployment dynamics through the standard mechanism. Third, our calibrated model suggests 46% of wage cyclicality in the data arises from incentives. A standard model without incentives calibrated to weakly procyclical wages, matches unemployment dynamics in our incentive pay model calibrated to strongly procyclical wages.
    Keywords: Dynamic Incentive Pay, Unemployment Dynamics
    JEL: J64
    Date: 2023–09
  4. By: Natalia Emanuel; Emma Harrington; Amanda Pallais
    Abstract: Amidst the rise of remote work, we ask: what are the effects of proximity to coworkers? We find being near coworkers has tradeoffs: proximity increases long-run human capital development at the expense of short-term output. We study software engineers at a Fortune 500 firm, whose main campus has two buildings several blocks apart. When offices were open, engineers working in the same building as all their teammates received 22 percent more online feedback than engineers with distant teammates. After offices closed for COVID-19, this advantage largely disappears. Yet sitting together reduces engineers' programming output, particularly for senior engineers. The tradeoffs from proximity are more acute for women, who both do more mentoring and receive more mentorship when near their coworkers. Proximity impacts career trajectories, dampening short-run pay raises but boosting them in the long run. These results can help to explain national trends: workers in their twenties who often need mentorship and workers over forty who often provide mentorship are more likely to return to the office. However, even if most mentors and mentees go into the office, remote work may reduce interaction: pre-COVID, having just one distant teammate reduced feedback among co-located workers.
    JEL: J16 J24 M15 M53 M54 O33 R23
    Date: 2023–11
  5. By: Carlos Carrillo-Tudela; Leo Kaas; Benjamin Lochner
    Abstract: Firms and workers predominately match via job postings, networks of personal contacts or the public employment agency, all of which help to ameliorate labor market frictions. In this paper we investigate the extent to which these search channels have differential effects on labor market outcomes. Using novel linked survey-administrative data we document that (i) low-wage firms and low-wage workers are more likely to match via networks or the public agency, while high-wage firms and high-wage workers succeed more often via job postings; (ii) job postings help firms the most in poaching and attracting high-wage workers and help workers the most in climbing the job ladder. To evaluate the implications of these findings for employment, wages and labor market sorting, we structurally estimate an equilibrium job ladder model featuring two-sided heterogeneity, multiple search channels and endogenous recruitment effort. The estimation reveals that networks are the most cost-effective channel, allowing firms to hire quickly, yet attracting workers of lower average ability. Job postings are the most costly channel, facilitate hiring workers of higher ability, and matter most for worker-firm sorting. Although the public employment agency provides the lowest hiring probability, its removal has sizeable consequences, with aggregate employment declining by at least 1.4 percent and rising bottom wage inequality.
    Keywords: search channels, on-the-job search, recruitment effort, sorting wage dispersion
    JEL: E24 J23 J31 J63 J64
    Date: 2023
  6. By: Nicholas Bloom; Leonardo Iacovone; Mariana Pereira-Lopez; John Van Reenen
    Abstract: We argue that greater misallocation is a key driver of the worse management practices in Mexico compared to the US. These management practices are strongly associated with higher productivity, growth, trade, and innovation. One indicator of greater misallocation in Mexico is the weaker size-management relationship compared to the US, particularly in the highly distorted Mexican service sector. Second, the size-management relationship is weaker in smaller markets, measured by distance to the US for manufacturing firms and population density for service firms. Third, municipalities with weaker institutions, measured by contract enforcement, crime, and corruption, have a weaker size-management relation. These results are consistent with frictions lowering aggregate management quality and productivity.
    Keywords: misallocation, management, performance, services, manufacturing, Mexico
    Date: 2022–01–25
  7. By: Cátia Cerqueira (NIPE/Center for Research in Economics and Management, University of Minho, Portugal); Fernando Alexandre (NIPE/Center for Research in Economics and Management, University of Minho, Portugal); Miguel Portela (NIPE/Center for Research in Economics and Management, University of Minho, Portugal; and IZA, Bonn)
    Abstract: This paper examines firms’ characteristics and the impact on firm performance of being a first mover in the adoption of cloud computing and big data digital technologies, relative to followers and non-adopters. Our results show that firms with higher levels of education both for managers and workers, and shorter managerial tenure are more likely to be digital adopters. First movers in the adoption of big data show distinct characteristics from followers, namely they are younger and have a larger share of higher education workers. Regarding the impact on firm performance, we find that first movers in cloud computing experience significant performance gains, namely in gross value added and productivity, compared to non-adopters, but no gains relative to followers. Interestingly, first movers in big data exhibit a productivity edge over followers and non-adopters. Furthermore, we find that higher levels of education and shorter managerial tenure amplify the positive effects of big data adoption on firm performance.
    Keywords: cloud computing, big data, management, digitalization, productivity, ICT
    JEL: D24 M10 E22 E23 J24 O33 L20
    Date: 2023
  8. By: Moens, Eline (Ghent University); Verhofstadt, Elsy (Ghent University); Van Ootegem, Luc (Ghent University); Baert, Stijn (Ghent University)
    Abstract: Many applicants want a job with the possibility of telework. However, the literature is unclear on whether being explicit about this wish and the reason for it leads to negative consequences on hiring intentions. In this paper we therefore investigate how expressing a desire for telework, for work-life balance and for productivity in particular, impacts the probability of receiving an interview and what it signals to recruiters. To this end, we set up a state-of-the-art vignette experiment in which recruiters evaluate fictitious applicants for different jobs. As a result of this experimental set-up, the answers to our research questions can be interpreted causally, and external validity benefits from the heterogeneity of the jobs. We find that if the desire for work-life balance is the stated motivation, the preference is punished more severely than if the motivation is productivity. Compared to applicants who do not mention a preference for telework, recruiters are 5.1 percentage points less inclined to invite applicants who pronounce this desire for work-life balance to an interview and 2.1 percentage points less inclined to invite applicants for whom the motivation is productivity. Lastly, mentioning a telework preference for work-life balance has a clear negative effect on anticipated achievement striving, commitment, and availability.
    Keywords: telework, interview probability, factorial survey experiment
    JEL: M51 M54 J22 J32 J63 J81
    Date: 2023–10
  9. By: Sule Alan; Gozde Corekcioglu; Mustafa Kaba; Matthias Sutter
    Abstract: At the very heart of a healthy work environment lies the quality of social interactions among colleagues and between leaders and subordinates. This column investigates the role of gender in transforming the relational atmosphere in the workplace. The results show that a fairer representation of female leadership may have benefits beyond efficiency and social justice concerns by creating a more inclusive and less segregated workplace, one in which employees and leaders form stronger inter-gender ties and female employees exhibit less voluntary quits.
    Date: 2023–11

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