nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2024‒03‒18
nine papers chosen by
Patrick Kampkötter, Eberhard Karls Universität Tübingen

  1. Moving apart: job-driven residential mobility and the gender pay gap Evidence from a large industrial firm. By Matthieu Bunel; Dominique Meurs; Élisabeth Tovar
  2. How Managers Can Use Purchaser Performance Information to Improve Procurement Efficiency By Pablo A. Celhay; Paul Gertler; Marcelo Olivares; Raimundo Undurraga
  3. Picking winners: Managerial ability and capital allocation By Benz, Andreas; Demerjian, Peter R.; Hoang, Daniel; Ruckes, Martin E.
  4. Interview Sequences and the Formation of Subjective Assessments By Jonas Radbruch; Amelie Schiprowski
  5. Procurement managers and effective tendering: The case of Italian public works contracts By Audinga Baltrunaite; Enza Maltese; Tommaso Orlando; Gabriele Rovigatti
  6. Wage Cyclicality and Labour Market Institutions By Pereira, João; Ramos, Raul; Martins, Pedro S.
  7. Job Loss, Unemployment Insurance, and Health: Evidence from Brazil By Amorim, Guilherme; Britto, Diogo; Fonseca, Alexandre; Sampaio, Breno
  8. The Potential of Recommender Systems for Directing Job Search: A Large-Scale Experiment By Behaghel, Luc; Dromundo, Sofia; Gurgand, Marc; Hazard, Yagan; Zuber, Thomas
  9. Gender Differences in Negotiations and Labor Market Outcomes: Evidence from an Information Intervention with College Students By Patricia Cortés; Jacob French; Jessica Pan; Basit Zafar

  1. By: Matthieu Bunel; Dominique Meurs; Élisabeth Tovar
    Abstract: This article uses a 15-year panel data set from a large French industrial firm to investigate the role of intra-firm job-driven residential mobility on the gender pay gap of executives. We find that job-driven residential mobility is highly profitable for both male and female workers due to a generous mobility bonus policy, but that it does not affect their careers. We also find that female executives are less likely than males to experience job-driven residential mobility, and that it brings higher gains to male relative to female executives. However, these differences between men and women linked to the mobility allowance make limited contribution to the total gender pay gap, which is almost entirely due to other bonuses linked to the positions held.
    Keywords: insider econometrics, personnel economics, gender pay gap, job mobility, residential mobility
    JEL: J16 J31 M12 R23
    Date: 2024
  2. By: Pablo A. Celhay; Paul Gertler; Marcelo Olivares; Raimundo Undurraga
    Abstract: We examine the effect of performance monitoring in public procurement through the lens of organizational culture in a principal-agent model where the manager (principal) and buyers (agents) may have different beliefs about how much the government values efficiency. We show that the effect of performance information not only increases efficiency but is greater when the buyer’s belief is stronger than the manager’s belief. We leverage a new e-procurement system in Chile to test these ideas by randomizing monthly reports on the purchasing performance of buyers and further whether the individual performance reports were disclosed to managers. We find that the reports generated sizable reductions in overspending — with savings reaching a 15% reduction or 0.1% of GDP — but only when individual performance was observable to managers. This is consistent with extrinsic motivation rather than intrinsic motivation driving buyer behavior. Consistent with the theoretical model, we also find that the gain in efficiency is concentrated in procurement units where buyer belief that the government cares about efficiency is stronger than manager belief. Our results highlight the key role played by organizational culture in mediating the impact of purchasing performance information on preventing the misuse of public resources.
    JEL: D23
    Date: 2024–02
  3. By: Benz, Andreas; Demerjian, Peter R.; Hoang, Daniel; Ruckes, Martin E.
    Abstract: We examine how division managers' human capital affects internal capital allocation using a hand-collected data set of divisional managers at S&P 1, 500 firms. Based on a novel measure of division-manager ability, we show that more able division managers receive substantially larger capital allocations. This effect is robust to controlling for the possibility of assortative matching and more pronounced for firms with better governance. We also find that the allocation of extra capital to higher-ability managers creates firm value. These findings suggest efficient fund transfers to high-productivity managers and provide support for a largely unexplored bright side of internal capital markets.
    Keywords: Managerial Ability, Managerial Efficiency, Human Capital, Capital Budgeting, Investment, Internal Capital Markets
    JEL: G31 G32 G34 J24
    Date: 2024
  4. By: Jonas Radbruch (HU Berlin); Amelie Schiprowski (University of Bonn)
    Abstract: Interviewing is a decisive stage of most processes that match candidates to firms and organizations. This paper studies how and why a candidate’s interview outcome depends on the other candidates interviewed by the same evaluator. We use large-scale data from high-stakes admission and hiring processes, where candidates are quasi-randomly assigned to evaluators and time slots. We find that the individual assessment decreases as the quality of other candidates assigned to the same evaluator increases. The influence of the previous candidate stands out, leading to a negative autocorrelation in evaluators’ votes of up to 40% and distorting final admission and hiring decisions. Our findings are in line with a contrast effect model where evaluators form a benchmark through associative recall. We assess potential changes in the design of interview processes to mitigate contrasting against the previous candidate.
    Keywords: hiring; interviewing; contrast effect; memory;
    JEL: D91 J20 M51
    Date: 2024–02–16
  5. By: Audinga Baltrunaite (Bank of Italy); Enza Maltese (Bank of Italy); Tommaso Orlando (Bank of Italy); Gabriele Rovigatti (Bank of Italy)
    Abstract: This paper studies whether and how much procurement managers matter for effective procurement outcomes. We utilize detailed data on Italian procurement for public works, and on the identity of public officials responsible for their tendering and execution. Our analysis shows that, ceteris paribus and even within the same procuring agency, the managers' identity matters for effective procurement. We further leverage institutional reforms that tightened the eligibility criteria for procurement managing roles as a natural experiment to evaluate the correlation between managerial quality and procurement performance. Key performance indicators include the duration of administrative procedures for tender awarding and the completion time for public works. Our findings suggest a direct positive relationship between the caliber of procurement managers and the expediency of both tender awarding and project completion.
    Keywords: public procurement, public works, public managers
    JEL: D73 H54 H57 R58
    Date: 2023–10
  6. By: Pereira, João (University of Évora); Ramos, Raul (University of Barcelona); Martins, Pedro S. (Nova School of Business and Economics)
    Abstract: Do labour institutions influence how wages respond to the business cycle? Such responsiveness can then shape several economic outcomes, including unemployment. In this paper, we examine the role of two key labour market institutions - collective bargaining and temporary contracts - upon wage cyclicality. Our evidence is drawn from rich, 2002-2020 matched data from Portugal. We find that workers not covered by collective agreements exhibit much higher wage cyclicality, especially if new hires, compared to covered workers. In contrast, workers under fixed-term contracts do not exhibit sizable differences in cyclicality compared to counterparts under open-ended contracts. Our findings highlight a novel angle through which labour institutions influence the labour market and the economy.
    Keywords: real wages, business cycles, collective bargaining, temporary contracts, matched data
    JEL: J31 J52
    Date: 2024–02
  7. By: Amorim, Guilherme (University of Illinois at Urbana-Champaign); Britto, Diogo (University of Milan Bicocca); Fonseca, Alexandre (Federal Revenue of Brazil); Sampaio, Breno (Universidade Federal de Pernambuco)
    Abstract: We study the effects of job loss and unemployment insurance (UI) on health among Brazilian workers. We construct a novel dataset linking individual-level administrative records on employment, hospital discharges, and mortality for a 17-year period, rarely available in the context of developing countries. Leveraging mass layoffs for identification, we find that job loss increases hospitalization (+33%) and mortality risks (+23%) for male workers, while women are not affected. These effects are pervasive over the distribution of age, tenure, income and education, and men's children are also negatively affected. Remarkably, about half of these impacts are driven by external causes associated with accidents and the violent Brazilian context. Using a regression discontinuity design, we show that access to UI partially mitigates the adverse effects of job loss on health. Our results indicate that the health costs of job loss are only partially explained by the income losses associated with job displacement.
    Keywords: job loss, unemployment insurance, hospitalization, deaths
    JEL: I12 J63 J65
    Date: 2024–02
  8. By: Behaghel, Luc (Paris School of Economics); Dromundo, Sofia (OECD); Gurgand, Marc (Paris School of Economics); Hazard, Yagan (Paris School of Economics); Zuber, Thomas (Banque de France)
    Abstract: We analyze the employment effects of directing job seekers' applications toward establishments likely to recruit. We run a two-sided randomization design involving about 800, 000 job seekers and 40, 000 establishments, based on an empirical model that recommends each job seeker to firms so as to maximize total potential employment. Our intervention induces a 1% increase in job finding rates for short term contracts. This impact comes from a targeting effect combining (i) a modest increase in job seekers' applications to the very firms that were recommended to them, and (ii) a high success rate conditional on applying to these firms. Indeed, the success rate of job seekers' applications varies considerably across firms: the efficiency of applications sent to recommended firms is 2.7 times higher than the efficiency of applications to the average firm. This suggests that there can be substantial gains from better targeting job search, leveraging firm-level heterogeneity.
    Keywords: recommender systems, matching, RCT, active labor market policies
    JEL: J64
    Date: 2024–02
  9. By: Patricia Cortés; Jacob French; Jessica Pan; Basit Zafar
    Abstract: We assess the role of information gaps in understanding gender differences in negotiation behavior by conducting a randomized information experiment on the 2018 to 2020 graduating cohorts of undergraduate business majors from Boston University. Prior to starting their job search, treated students were provided with objective information about the gender gap in negotiation among their peers along with the earnings changes conditional on negotiating. We find sizable immediate effects on negotiation intentions that persist to actual negotiation behavior, particularly for men. While the treatment affects women's negotiation behavior through belief-updating, the effects on men's behavior are primarily through increased salience of the information. Further, we find some evidence that gender-specific treatment spillovers likely contribute to the smaller average treatment effects on behavior for women. Overall, our findings suggest that such information interventions can help to nudge women who have potentially large financial returns to negotiation to realize these gains.
    JEL: J16 J31
    Date: 2024–02

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