| By: |
Elisa Gerten (Faculty of Management, Economics and Social Sciences, University of Cologne, Albertus-Magnus-Platz, D-50923 Cologne, Germany);
Michael Beckmann (Faculty of Business and Economics, University of Basel, Peter Merian-Weg 6, CH-4002 Basel, Switzerland; Institute for Employment Research (IAB), Nuremberg, Germany; IZA Institute of Labor Economics, Bonn,Germany;);
Elisa Gerten (Faculty of Management, Economics and Social Sciences, University of Cologne, Albertus-Magnus-Platz, D-50923 Cologne, Germany);
Matthias Kräkel (Department of Economics, University of Bonn, Adenauerallee 24-42, D-53113 Bonn, Germany; IZA Institute of Labor Economics, Bonn, Germany) |
| Abstract: |
In recent decades, information and communication technology (ICT) has been
associated with far-reaching changes in the design of jobs. However, it still
remains unclear whether these changes will lead to more centralization or more
decentralization in firms. Previous literature on this debate has focused on a
strict dichotomy between the two possible directions. In contrast, our
theoretical and empirical analyses show that equipping employees with ICT
leads to both more centralized and more decentralized job-design policies.
This finding is particularly pronounced for executive employees, who are
granted more work autonomy but also experience more control via stronger
monitoring, while non-executive employees only experience more monitoring
without receiving more work autonomy. Our theoretical setting is based on a
modified principal-agent model. In our empirical approach we apply estimation
models that account for both endogeneity and essential heterogeneity, thereby
exploiting exogenous geographic variation in our instrumental variable. |