nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2024‒02‒05
six papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

  1. Employers’ Demand for Personality Traits and Provision of Incentives By Brencic, Vera; McGee, Andrew
  2. When protection becomes exploitation: The impact of firing costs on present-biased employees By Florian Englmaier; Matthias Fahn; Ulrich Glogowsky; Marco A. Schwarz
  3. Non-Wage Job Values and Implications for Inequality By Lehmann, Tobias
  4. Whoever You Want Me to Be: Personality and Incentives By McGee, Andrew; McGee, Peter
  5. The role of monetary incentives and feedback on how well students calibrate their academic performance By Gerardo Sabater-Grande; Noemí Herranz-Zarzoso; Aurora García-Gallego
  6. Representation is not sufficient for selecting gender diversity By Baron, Justin; Ganglmair, Bernhard; Persico, Nicola; Simcoe, Timothy S.; Tarantino, Emanuele

  1. By: Brencic, Vera (University of Alberta, Department of Economics); McGee, Andrew (University of Alberta, Department of Economics)
    Abstract: We measure firms’ demands for personality traits from job ads and assess how these demands relate to the incentives firms offer. The demand measures produce intuitive rankings of occupations in terms of personality requirements and, at the occupation-level, are positively correlated with the traits of workers in those occupations for all traits except emotional stability. Employers primarily demand workers who are extroverted, conscientious, and open-to-experience. Firms seeking conscientious workers are less likely to offer incentive pay and promotion opportunities, which suggests that personality demands interact with the optimal design of pay if conscientious workers require fewer incentives to elicit effort.
    Keywords: personality; job ads; incentive pay; promotions; recruitment
    JEL: D22 J23 J24 J33 M51
    Date: 2023–12–29
  2. By: Florian Englmaier; Matthias Fahn; Ulrich Glogowsky; Marco A. Schwarz
    Abstract: Employment protection harms early-career employees without benefitting them in later career stages (Leonardi and Pica, 2013). We demonstrate that this pattern can result from employers exploiting naive present-biased employees. Employers offer a dynamic contract with low early-career wages, an unattractive intermediate qualification stage, and high end-of-career wages. Upon reaching the qualification stage, present-biased employees exchange future wages for immediate rewards on an alternative career path - a choice unanticipated by their previous, naive, self. Thus, employers never pay high future wages. Firing costs help employers indicate that they will not oust employees instead of making promised payments, enabling early-career wage cuts.
    Keywords: Employment protection laws, present bias, dynamic contracting
    JEL: D21 D90 J33 K31 M52
    Date: 2023–12
  3. By: Lehmann, Tobias (USI Università della Svizzera Italiana)
    Abstract: I study inequality in job values, both in terms of wages and non-wage values, in Austria over the period 1996 to 2011. I show that differences in non-wage job value between firms are non-parametrically identified from data on worker flows and wage differentials. Intuitively, firms with high non-wage value attract workers without paying a wage premium. I study the distribution of job value among workers and find a positive correlation between wage and non-wage value. Inequality in job value is thus considerably greater than wage inequality, reflected in the standard deviation of job value being more than twice as large as the standard deviation of wage. Job value inequality increases between 1996 and 2011, although wage inequality remains constant. An important reason is that, over time, dispersion of rents offered by firms increases, while compensating differentials lose importance.
    Keywords: inequality, amenities, worker heterogeneity, firm heterogeneity, on-the-job search, wage dispersion, matched employer-employee data
    JEL: E24 J31 J32
    Date: 2023–12
  4. By: McGee, Andrew (University of Alberta, Department of Economics); McGee, Peter (University of Arkansas)
    Abstract: What can employers learn from personality tests when applicants have incentives to misrepresent themselves? Using a within-subject, laboratory experiment, we compare personality measures with and without incentives for misrepresentation. Incentivized personality measures are weakly to moderately correlated with non-incentivized measures in all treatments. When test-takers are given a job ad indicating that an extrovert (introvert) is desired, extroversion measures are positively (negatively) correlated with IQ. Among other characteristics, only locus of control appears related to faking on personality measures. Our findings highlight the identification challenges in measuring personality and the potential for correlations between incentivized personality measures and other traits.
    Keywords: personality; measurement; hiring; screening; experiments
    JEL: C91 D82 M50
    Date: 2023–12–29
  5. By: Gerardo Sabater-Grande (LEE and Department of Economics, Universitat Jaume I, Castellón, Spain); Noemí Herranz-Zarzoso (Department of Economic Analysis, Universitat de València, Spain); Aurora García-Gallego (LEE & Economics Department, Universitat Jaume I, Castellón-Spain)
    Abstract: We analyze the effectiveness of monetary incentives and/or feedback in order to improve students’ calibration of academic performance. A randomized field experiment is implemented in which undergraduate students enrolled in a Microeconomics course are offered the possibility to judge their academic performance immediately before (prediction) and after (postdiction) completing each of the three exam-multiple choice tests of their continuous evaluation. Potential (actual) miscalibration in each test is calculated as the difference between the predicted (post-dicted) grade and the actual grade. The treatment variables are monetary incentives and individual feedback since they may potentially affect students’ judgment accuracy. Different treatments allow for the analysis of the effect of one of the variables alone or the joint effect of introducing the two variables. The main result is that potential and actual miscalibration are independent of the treatment variables. Our data analysis controls for confounding factors like students’ cognitive ability, academic record, risk attitudes and personality traits. Our data reflect that students’ potential miscalibration is significantly reduced in subsequent tests to the first, only in the treatment where individual feedback as well as monetary incentives are provided.
    Keywords: calibration of academic performance, monetary incentives, feedback, prediction, post-diction
    JEL: C93 D03
    Date: 2024
  6. By: Baron, Justin; Ganglmair, Bernhard; Persico, Nicola; Simcoe, Timothy S.; Tarantino, Emanuele
    Abstract: One strategy for promoting female leaders in STEM professions is to appoint more women to the committees that select leaders. Unfortunately, evidence from other settings, such as committees for selecting judges or professors, suggests this approach does not work. We use a natural experiment to test the idea that organizational norms supporting gender diversity are necessary for representation on 'selectorates' to promote gender diversity among STEM leaders. Our empirical setting is the Internet Engineering Task Force (IETF) - a standard-setting organization that develops key protocols for Internet hardware and software. We find that when more women are randomly selected for the committee that appoints IETF leaders, the committee appoints more female leaders, but only after a set of interventions meant to increase members' awareness of the benefits of gender diversity.
    Date: 2023

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