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on Human Capital and Human Resource Management |
| By: | Anderlik, Jasmin (Ministry of Labor and the Economy, Vienna); Jumaniyozova, Malika (Johannes Kepler University, Linz); Schmidpeter, Bernhard (IZA, Institute for the Study of Labor, Bonn, RWI - Leibnitz Institute for Economic Research, Essen and Vienna University of Business and Economics, Vienna.); Winter-Ebmer, Rudolf (Johannes Kepler University, Linz, Institute for the Study of Labor, Bonn, Institute for Advanced Studies, Vienna and CEPR, Centre for Economic Policy Research, London) |
| Abstract: | Using linked vacancy-employer-employee data from Austria, we investigate how monopsony power affects firms’ posting behavior and wage negotiations. Consistent with theoretical predictions, we find that firms with greater monopsony power post lower wages and offer fewer non-wage amenities, suggesting that wages and non-wage benefits are complementary. However, we find no evidence that monopsonistic firms demand higher levels of skill or education. Instead, our results indicate that they require more basic skills, particularly those related to routine tasks. On the workers’ side, we find that employees hired in monopsonistic labor markets face significantly lower wages, both initially and in the long run. These lower wages are driven by both lower posted wages and reduced bargaining power, as well as reduced opportunities to climb the wage ladder later. |
| Keywords: | Monopsony, wage bargaining, job amenities, wages |
| JEL: | J42 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:ihs:ihswps:number58 |
| By: | Katarína Borovičková; Robert Shimer |
| Abstract: | We develop a random search model with two-sided heterogeneity and match-specific productivity shocks to explain why high-productivity workers tend to work at high-productivity firms despite low-productivity workers gaining about as much from such matches. Our model has two key predictions: i) the average log wage that a worker receives is increasing in the worker's and employer's productivity, with low-productivity workers gaining proportionally more at high-productivity firms and ii) there is assortative matching between a worker's productivity and that of her employer. Selective job acceptance drives these patterns. All workers are equally likely to meet all firms, but workers have higher surplus from meeting firms of similar productivity. The high surplus meetings result in matches more frequently, generating assortative matching. Only the subset of meetings that result in matches are observed in administrative wage data, shaping wages. We show that our findings are quantitatively consistent with recent empirical results. Moreover, we prove this selection is not detected using standard empirical approaches, highlighting the importance of theory-guided empirical work. Our results imply that encouraging high-wage firms to hire low-wage workers may be less effective at reducing wage inequality than wage patterns suggest. |
| JEL: | J31 J64 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33184 |
| By: | M. Keith Chen; Katherine Feinerman; Kareem Haggag |
| Abstract: | Modern tech platforms provide workers real-time control over when they work, and increasingly, flexible pay: the option to be paid immediately after work. We investigate the labor supply effects of pay flexibility and the implications of present-biased preferences among gig-economy workers. Using granular data from a nationwide randomized controlled trial at Uber, we estimate the effects of switching from a fixed weekly pay schedule to Instant Pay, a system that allows on-demand, within-day withdrawals. We find that flexible pay substantially increased drivers’ work time. Furthermore, consistent with present bias, the response is significantly higher when drivers are further away from the end of their counterfactual weekly pay cycle. We discuss welfare and broader implications in contexts in which workers have the ability to flexibly supply labor. |
| JEL: | J0 J20 J3 R4 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33177 |
| By: | Joep Konings; Aaron Putseys |
| Abstract: | We assess how subsidies for on-the-job training affect firm performance. Using a difference-in- differences research design, we find that these subsidies positively influence firm size, wages, and productivity. Over four years, employment increases by 3.55%, value added by 5.68%, and labor costs by 3.60%. Average wages and labor productivity grow by 1.95% and 2.12%, respec- tively. In the first year of treatment, a notable discrepancy exists between the wage (1.21%) and productivity (2.18%) effects, indicating incomplete rent-sharing. These positive effects are primarily seen in smaller firms, which significantly increase training expenditures and hours in the year they receive subsidies, resulting in more trained and skilled workers. Larger firms do not show similar effects, highlighting the possibility that these firms relabel existing training ac- tivities to take advantage of the training subsidy program. Additionally, we find that subsidies focused on training in human resource management, logistics, and business skills drive these positive outcomes for firm size at the firm level. |
| Keywords: | Productivity, Programme evaluation, SMEs growth, Training subsidies |
| Date: | 2025–01–10 |
| URL: | https://d.repec.org/n?u=RePEc:ete:ceswps:757420 |
| By: | Jansen, Laura (University of Groningen); Angelini, Viola (University of Groningen); Groneck, Max; van Ooijen, Raun (De Nederlandsche Bank) |
| Abstract: | This paper studies the impact of stronger employer responsibilities for facilitating work resumption of sick or disabled workers on employers' workplace accommodation efforts during sick leave. We exploit a reform in the Netherlands that altered experience rating – i.e., shifting the costs of sick leave and disability insurance to the firm – both for permanent and non-permanent employees. Using unique Dutch survey data on workplace accommodation of long-term sick-listed workers, we show that experience rating has no significant impact on accommodation efforts. Moreover, we provide evidence that the reform led to more firms opting for self-arranging both the sick leave benefits and the reintegration process of sick non-permanent workers, instead of using the public insurance scheme. |
| Keywords: | workplace accommodation, disability insurance, experience rating, employer incentives |
| JEL: | H32 I13 J14 J24 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17606 |
| By: | Katharina Laske; Nathalie Römer; Marina Schröder |
| Abstract: | We introduce the word illustration task (WIT), a novel experimental task to quantify performance in an idea generation context. Between treatments, we vary whether or not piece-rate (PR) incentives are implemented and the degree to which these incentives are aligned with the desirable outcome. We show that PR incentives have a positive impact on the number of innovative ideas, i.e., the number of ideas that are of high quality and original. We find that unweighted PR incentives (PR provided for any idea) perform at least as well as more aligned weighted PR incentives that are additionally contingent on the quality and/or originality of ideas. Our results suggest that when it comes to fostering idea generation, it is sufficient to incentivize trying instead of incentivizing succeeding. |
| Keywords: | idea generation, real-effort experiment, incentives, creativity |
| JEL: | C90 J33 M52 O31 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11594 |
| By: | Johannes Lehmann; Michael Beckmann |
| Abstract: | Using novel survey data from Swiss firms, this paper empirically examines the relationship between the use of digital technologies and the prevalence of performance incentives. We argue that digital technologies tend to reduce the cost of organizational monitoring through improved measurement of employee behavior and performance, as well as through employee substitution in conjunction with a reduced agency problem. While we expect the former mechanism to increase the prevalence of performance incentives, the latter is likely to decrease it. Our doubly robust ATE estimates show that companies using business software and certain key technologies of Industry 4.0 increasingly resort to performance incentives, suggesting that the improved measurement effect dominates the employee substitution effect. In addition, we find that companies emerging as technology-friendly use performance incentives more frequently than their technology-averse counterparts. Both findings hold for managerial and non-managerial employees. Our estimation results are robust to a variety of sensitivity checks and suggest that Swiss businesses leverage digital technologies to enhance control over production or service processes, allowing them to intensify their management of employees through performance incentives. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2412.12780 |