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on Human Capital and Human Resource Management |
| By: | Nicholas Bloom; James Liang; John Roberts; Zhichun Jenny Ying |
| Abstract: | About 10% of US employees now regularly work from home (WFH), but there are concerns this can lead to "shirking from home." We report the results of a WFH experiment at CTrip, a 16,000-employee, NASDAQ-listed Chinese travel agency. Call center employees who volunteered to WFH were randomly assigned to work from home or in the office for 9 months. Home working led to a 13% performance increase, of which about 9% was from working more minutes per shift (fewer breaks and sick-days) and 4% from more calls per minute (attributed to a quieter working environment). Home workers also reported improved work satisfaction and experienced less turnover, but their promotion rate conditional on performance fell. Due to the success of the experiment, CTrip rolled-out the option to WFH to the whole firm and allowed the experimental employees to re-select between the home or office. Interestingly, over half of them switched, which led to the gains from WFH almost doubling to 22%. This highlights the benefits of learning and selection effects when adopting modern management practices like WFH. |
| Keywords: | working from home, organization, productivity, field experiment, and China |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1194&r=hrm |
| By: | Charness, Gary; Masclet, David; Villeval, Marie Claire |
| Abstract: | Unethical behavior within organizations is not rare. We investigate experimentallythe role of status-seeking behavior in sabotage and cheating activities aiming at improving one’sperformance ranking in a flat-wage environment. We find that average effort is higher whenindividuals are informed about their relative performance. However, ranking feedback alsofavors disreputable behavior. Some individuals do not hesitate to incur a cost to improve theirrank by sabotaging others’ work or by increasing artificially their own performance. Introducingsabotage opportunities has a strong detrimental effect on performance. Therefore, rankingincentives should be used with care. Inducing group identity discourages sabotage among peersbut increases in-group rivalry. |
| Keywords: | Economics, Status, ranking, feedback, sabotage, doping, competitive preferences, experiment |
| Date: | 2013–01–23 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucsbec:qt3858888w&r=hrm |
| By: | Magnac, Thierry (TSE); Pistolesi, Nicolas (TSE); Roux, Sébastien (CREST INSEE, Paris) |
| Abstract: | We propose an original model of human capital investments after leaving school in which individuals di¤er in their initial human capital obtained at school, their rate of return, their costs of human capital investments and their terminal values of human capital at a fixed date in the future. We derive a tractable reduced form Mincerian model of log earnings profiles along the life cycle which is written as a linear factor model in which levels, growth and curvature of earnings profiles are individual-specific. Using panel data from a single cohort of French male wage earners observed over a long span of 30 years, a random effect model is estimated first by pseudo maximum likelihood methods. This step is followed by a simple second step fixed e¤ect method by which individual-specific structural parameters are estimated. This allows us to test restrictions, compute counterfactual profiles and evaluate how earnings inequality over the life-cycle is a¤ected by changes in structural parameters. Under some conditions, even small changes in life expectancy seem to imply large changes in earnings inequality. |
| Keywords: | human capital investment, earnings dynamics, post-schooling earnings growth, dynamic panel data |
| JEL: | C33 D91 J24 J31 |
| Date: | 2013–01 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:26788&r=hrm |
| By: | Kolm, Ann-Sofie (Dept. of Economics, Stockholm University); Tonin, Mirco (University of Southampton (and Central European University, Budapest; IZA, Bonn)) |
| Abstract: | Welfare benefits in the Nordic countries are often tied to employment. We argue that this is one of the factors behind the success of the Nordic model, where a comprehensive welfare state is associated with high employment. In a general equilibrium setting, the underlining mechanism works through wage moderation and job creation. The benefits make it more important to hold a job, thus lower wages will be accepted, and more jobs created. Moreover, we show that the incentive to acquire higher education improves, further boosting employment in the long run. These positive effects help counteracting the negative impact of taxation. |
| Keywords: | Nordic model; in-work benefits; wage adjustment; unemployment; education; skill formation; earnings |
| JEL: | H24 J21 J24 |
| Date: | 2013–01–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2013_0001&r=hrm |
| By: | Lindahl, Mikael (Uppsala University, CESifo, IFAU, IZA and UCLS); Palme, Mårten (Dept. of Economics, Stockholm University); Sandgren Massih, Sofia (Uppsala University); Sjögren, Anna (IFAU, UCLS and SOFI Stockholm University) |
| Abstract: | Most previous studies of intergenerational transmission of human capital are restricted to two generations – parents and their children. In this study we use a Swedish data set which enables us link individual measures of lifetime earnings for three generations and data on educational attainments of four generations. We investigate to what extent estimates based on income data from two generations accurately predict earnings persistence beyond two generations. We also do a similar analysis for intergenerational persistence in educational attainments. We find two-generation studies to severely under-predict intergenerational persistence in earnings and educational attainment over three and four generations. |
| Keywords: | Intergenerational income mobility; Human capital transmission; Multigenerational income mobility |
| JEL: | D31 J62 |
| Date: | 2013–01–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2013_0003&r=hrm |
| By: | Navarra, Cecilia (University of Namur); Tortia, Ermanno (University of Trento) |
| Abstract: | We argue that in a capitalist enterprise the need to fix wages is crucially influenced by the asymmetric distribution of decision-making power, which can entail the use of private information and authority in favour of the strongest contractual party (the employer), and against the weaker contractual party (the employee). The capitalist entrepreneur can take decisions whose negative consequences are borne by workers in terms of lower wages and more intensive work-pace. Excessive wage reductions in the face of negative exogenous shocks, and of too risky investment decision represent the main instances of such opportunistic behaviour. Fixed wages can be thought as workers’ best response to the emerging risk of the employers’ moral hazard, but this implies a heightened risk of lay-off since wages and employment levels cannot be fixed at one and the same time. As a counterexample, we observe worker cooperatives, which depart from the framework of the interaction between a principal and an agent in the presence of contrasting interests and private information. Indeed, several empirical studies show greater employment stability and wage flexibility in worker cooperatives vis à vis capitalist firms. |
| Keywords: | employment contract; wage rigidity; risk aversion; moral hazard; worker cooperative |
| JEL: | J54 J64 J83 |
| Date: | 2013–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:aiccon:2013_117&r=hrm |
| By: | Lindahl, Mikael (Uppsala University, CESifo, IFAU, IZA and UCLS); Palme, Mårten (Dept. of Economics, Stockholm University); Sandgren Massih, Sofia (Uppsala University); Sjögren, Anna (IFAU, UCLS and SOFI Stockholm University) |
| Abstract: | We estimate the well-known Becker-Tomes (1986) model of intergenerational transmission of human capital. A Swedish data set which links individual measures on educational attainments of four generations, enables us to use great grandparents’ education as an instrumental variable. This approach was suggested already in Becker- Tomes (1986) but, because of the lack of data, never implemented. The identifying assumption, which holds within the Becker-Tomes framework, is that great grandparents’ education is unrelated to great grandchild’s education, conditional on the education of the parent and grandparent. We test the prediction that the structural parameter for grandparents’ education enters with a negative sign in an intergenerational regression model where the education of a child is linearly related to the education of the parent and the education of the grandparent. We fail to find empirical support for the model’s predictions. |
| Keywords: | The Becker-Tomes model; Human capital transmission; Multigenerational effects |
| JEL: | D31 J62 |
| Date: | 2013–01–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2013_0002&r=hrm |
| By: | Maria De Paola; Francesca Gioia (Dipartimento di Scienze Economiche, Statistiche e Finanziarie, Università della Calabria) |
| Abstract: | In a simple theoretical model we show that impatience affects academic performance through two different channels: impatient students spend less effort in studying activities and set less ambitious objectives in terms of grades at exams. As a consequence, the relationship between impatience and academic success may vary according to how performance is measured. Using data from a sample of Italian undergraduate students, we find a strong negative relationship between impatience and both the average grade at exams and the probability of graduating with honours. Conversely, a negative but not statistically significant correlation emerges between time preferences and both the number of credits earned in the three years following enrolment and the probability of timely graduation. Our findings are robust to alternative measures of impatience and controlling for family background characteristics, for cognitive abilities and for risk preferences. |
| Keywords: | Time preferences, impatience, human capital, academic success |
| JEL: | I20 D03 D91 J01 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201302&r=hrm |
| By: | Antonio Paradiso (Department of Economics, University of Rome La Sapienza, Rome, Italy); Saten Kumar (Department of Economics, Auckland University of Technology, Auckland, New Zealand.); B. Bhaskara Rao (School of Economics and Finance, University of Western Sydney, Sydney, Australia.) |
| Abstract: | In this paper we estimate the growth effects of human capital with country-specific time series data for Australia. Previous empirical studies, based on international data, have been inconclusive, in terms of the extent of the contribution of human capital to growth. We extend the Solow (1956) growth model by using educational attainment as a measure of human capital, as developed by Barro and Lee (2010). The extended Solow (1956) model performs well after allowing for the presence of structural changes. Our results, based on alternative time series methods, show that educational attainment has a small and significant permanent effect on the growth rate of per worker output in Australia. Alternative measures of human capital are also utilized to ensure robustness of results. |
| Keywords: | Steady State Growth Rates, Economic Growth, Education, Australia |
| JEL: | C22 O56 O40 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:aut:wpaper:201105&r=hrm |
| By: | Charness, Gary; Grieco, Daniela |
| Abstract: | Creativity is a complex and multi-dimensional phenomenon that has hardly been considered byeconomists, despite a great deal of economic importance. This paper presents a series ofexperiments where subjects face creativity tasks where, in one case, ex-ante goals and constraintsare imposed on their answers, and in the other case no restrictions apply. The effects of financialincentives in stimulating creativity in both types of tasks is then tested, together with the impactof personal features like risk and ambiguity aversion. Our findings show that, in general,financial incentives affect “in-box†(constrained) creativity, but do not facilitate “blue skyâ€(unconstrained) creativity. However, in the latter case incentives do play a role for ambiguityaverseagents, who tend to be significantly less creative and seem to need extrinsic motivation toexert effort in a task whose odds of success they don’t know. We do find that measures ofcreative style, sensation-seeking preferences, and past involvement in artistic endeavors arerelated to our creativity score, but do not find any difference across gender for either form ofcreativity. |
| Keywords: | Economics, creativity, incentives, ambiguity, constraints, ex-ante goals |
| Date: | 2013–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:ucsbec:qt4mr6p1d5&r=hrm |
| By: | Marco Grazzi; Nadia Jacoby; Tania Treibich |
| Abstract: | If the relation between investment and economic growth is well established in the macroeconomic literature, the existence of a similar link at the level of the firm has been challenged by empirical work. This paper investigates the channels linking investment and firm performance in the French and Italian manufacturing industries. It does so by putting forth a novel methodology to identify investment spikes that corrects for size dependence. While maintaining the desired properties of a spike measure, our chosen proxy retrieves the expected relation between investment and firm performance. Ex-ante, more efficient and fast growing firms display a higher probability to invest; in turn, after an investment spike has taken place the group of investing firms shows further gains in performance. Finally, expansionary investment episodes, as proxied by the opening of new plants, have a negative effect on profitability while they are associated with higher sales and employment levels. |
| Keywords: | Firm heterogeneity, investment spike, industrial dynamics, corporate performance, capital accumulation, technical change |
| Date: | 2013–02–13 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2013/06&r=hrm |
| By: | Erixon, Lennart (Dept. of Economics, Stockholm University) |
| Abstract: | The theory of transformation pressure maintains that central actors in established firms will be more productive when experiencing an actual fall in profits. Actors fearing that the survival of the firm is at stake will then become more alert, calculating and creative favoring a transformation. The neo-Schumpeterians follow Schumpeter by largely ignoring the importance of negative driving forces for innovations and the productivity performance of firms. In the neoclassical Schumpeterian literature stronger competition and also lower product demand may induce innovations and productivity increases in established firm. But this literature neglects the underlying psychological mechanism. The ideas in the theory of transformation pressure can easily be incorporated into a Darwinian framework emphasizing basic human drives, the struggle for existence and the adaptation to new external circumstances. The results from tests of the theory of transformation pressure are ambiguous. An experiment confirmed that firms are governed by bounded rationally but only partly that they will upgrade their growth strategy in a profit recession. There are arguments in both industrial economics, psychology and neuroscience for a qualified theory of transformation pressure. Productivity is enhanced by moderate pressure or by periodic shifts between hard pressures and good opportunities. |
| Keywords: | transformation pressure; bounded rationality; creative destruction; negative driving forces; productivity growth; innovations; neuroscience; stress; economic psychology; universal Darwinism |
| JEL: | B52 D21 E32 L21 O31 |
| Date: | 2013–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2013_0004&r=hrm |
| By: | Bobtcheff, Catherine (Toulouse School of Economics (CNRS, LERNA)); Bolte, Jérôme (Toulouse School of Economics (GREMAQ)); Mariotti, Thomas (Toulouse School of Economics (CNRS, GREMAQ, IDEI)) |
| Abstract: | We model academic competition as a game in which researchers ¯ght for priority. Researchers privately experience breakthroughs and decide how long to let their ideas mature before making them public, thereby establishing priority. In a two-researcher, symmetric environment, the resulting preemption game has a unique equilibrium. We study how the shape of the breakthrough distribution affects equilibrium maturation delays. Making researchers better at discovering new ideas or at developing them has contrasted effects on the quality of research outputs. Finally, when researchers have different innovative abilities, speed of discovery and maturation of ideas are positively correlated in equilibrium. |
| Keywords: | Academic Competition, Preemption Games, Private Information. |
| JEL: | C73 D82 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:26784&r=hrm |
| By: | Weng, Qian (Department of Economics, School of Business, Economics and Law, Göteborg University); Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Common identity and peer punishment have been identified as important means to reduce free riding and to promote cooperation in teamwork settings. This paper examines the relative importance of these two mechanisms, as well as the importance of income distribution in team cooperation. In a repeated public good experiment, conditions vary among different combinations of homogenous or heterogeneous endowment, strong or weak identity, and absence or presence of peer punishment. We find that without punishment, strong identity can counteract the negative impact of endowment heterogeneity on cooperation. Moreover, punishment increases cooperation irrespective of income distribution and identity strength, and cooperation is similar across all treatments with punishment. These findings provide important implications for management policy makers in organizations: implementing ex ante income heterogeneity within teams should be done with caution, and a very strong peer punishment mechanism is more effective in enhancing cooperation over common identity when both are viable.<p> |
| Keywords: | Endowment distribution; identity; punishment; cooperation; public goods experiment |
| JEL: | C91 D63 H41 M54 |
| Date: | 2013–01–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0551&r=hrm |
| By: | Schneck, Stefan |
| Abstract: | This paper descriptively analyzes the nexus between income comparisons and perceptions of unfair pay. A German household survey reveals that individuals who perceive their wages as unfair earn significantly lower wages than fairly paid individuals with similar characteristics. This suggests that unfairness perceptions with respect to wages are based on sound income comparisons with peers. When asked about a subjectively fair amount in Euros, individuals tend to claim much higher wages than fairly paid individuals with identical characteristics. -- |
| Keywords: | Fairness,Wages |
| JEL: | J30 J31 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:70096&r=hrm |
| By: | Rasmus Landersø (Department of Economics and Business, Aarhus University); Helena Skyt Nielsen (Department of Economics and Business, Aarhus University); Marianne Simonsen (Department of Economics and Business, Aarhus University) |
| Abstract: | This paper investigates the effects of school starting age on crime while relying on variation in school starting age induced by administrative rules; we exploit that Danish children typically start first grade in the calendar year they turn seven, which gives rise to a discontinuity in children’s school starting age. Analyses are carried out using register-based Danish data. We find that higher age at school start lowers the propensity to commit crime, but that this reduction is caused by incapacitation while human capital accumulation is unaffected. Importantly, we also find that the individuals who benefit most from being old-for-grade are those with high latent abilities whereas those with low latent ability seem to be unaffected by being old-for-grade in school. |
| Keywords: | old-for-grade, school start, criminal charges, violence, property crime |
| JEL: | I21 K42 |
| Date: | 2013–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2013-03&r=hrm |
| By: | Åslund, Olof (Uppsala Center for Labor Studies); Engdahl, Mattias (Uppsala Center for Labor Studies) |
| Abstract: | We study the effects of performance bonuses in immigrant language training for adults. A Swedish policy pilot conducted in 2009–2010 gave a randomly assigned group of municipalities the right to grant substantial cash bonuses to recently arrived migrants. The results suggest substantial effects on average student achievement. But these were fully driven by metropolitan areas; in other parts of Sweden performance was unaffected. The relative effects were larger for younger students but similar for men and women, and present for migrants from different parts of the world. The bonus had a less clear impact on enrollment, but there are indications that it may have increased the probability of progressing to bonus-awarding courses in metropolitan areas. |
| Keywords: | immigration; language training; performance bonus |
| JEL: | I24 J08 J15 |
| Date: | 2013–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uulswp:2013_001&r=hrm |
| By: | Maria De Paola; Francesca Gioia; Vincenzo Scoppa (Dipartimento di Scienze Economiche, Statistiche e Finanziarie, Università della Calabria) |
| Abstract: | We analyze how overconfidence is affected by superstitious beliefs and emotions induced by positive and negative stimuli in a field experiment involving about 700 Italian students who were randomly assigned to numbered seats in their written examination sessions. According to widespread superstitions, some numbers are considered lucky, while others are considered unlucky. At the end of the examination, we asked students the grade they expected to get. We find that students tend to be systematically overconfident and that their overconfidence is positively affected by being assigned to a lucky number. Interestingly, males and females react differently: on the one hand, females tend to expect lower grades when assigned to unlucky numbers, while they are not affected by being assigned to lucky numbers. On the other hand, males are not affected by being assigned to unlucky numbers but expect higher grades when assigned to lucky numbers. |
| Keywords: | Expectations, Grade, Overconfidence, Emotions, Superstition |
| JEL: | D01 D83 D03 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201303&r=hrm |