Labor
Lightning Round SessionSunday, Jan. 5, 2025 8:00 AM - 10:00 AM (PST)
- Chair: Isaac Sorkin, Stanford University
COVID-19, Work from Home, and Racial Attitudes
Abstract
The existing literature has addressed the significance of intergroup contact as a way to reduce stereotypes towards racial minorities. The COVID-19 pandemic has dramatically changed the nature of jobs, which forced millions of people to work from home. This paper studies the differences between face-to-face and virtual contact, to understand people’s attitudes towards different racial groups. Specifically, this paper uses occupations that can be worked from home as a proxy for virtual workplace exposure, applying difference-in-difference model, to study whether there is a change in racial attitudes. The result suggests that face-to-face contact helps to build intergroup relationships and reduces discrimination compared to virtual contact.Hiring and the Dynamics of the Gender Gap
Abstract
In this study, we examine how the same hiring opportunity leads to different labormarket outcomes for male and female full-time workers. By utilizing matched employer-employee
data from Germany, our empirical approach leverages 30,000 unforeseen worker
deaths spanning from 1980 to 2016 which enables us to explore how firms react to exogenous
vacancies. In a first exercise, we propose a novel measure of the gender wage gap by comparing
the wages of deceased workers and their replacements across four transition groups:
male-male, male-female, female-male, and female-female. Using the respective transition
gap of groups without a change in gender as a counterfactual, we estimate the resulting
gender wage gap to be about 15 to 20 log points. Furthermore, we use machine learning
to compare workers who are hired into similar positions, and find that, regardless of the
departed worker’s gender, female replacement workers are offered (or negotiate) positions
with average starting wages that are 20 log points lower than their male counterparts. Even
after considering the pre-hire wage of replacement workers at their previous firm, half of
this gap persists. The wage gap does not close over the subsequent years. The gender disparity
in opportunities cannot be attributed to redistribution of wages paid among other
coworkers.
Hiring in a Diverse Labor Market: Spillovers Across Minority Groups
Abstract
I consider a labor market where white, Black, and Hispanic workers are available for hire. I first examine whether there exists bias in the hiring of Black or Hispanic workers. I then ask: Do positive or negative hiring experiences with one minority group affect subsequent bias and hiring decisions regarding a different minority group? And does the answer depend on which specific minority group (Black or Hispanic) employers have experience first? I address my research questions using an online hiring experiment, which allows me to measure biases in beliefs and decision-making, and to identify how discrimination against Black and Hispanic workers is causally affected by experiences. The (incomplete) data show evidence of significant biases in initial beliefs regarding the productivity of workers from both minority groups: overall, about 50% of employers think that Black and Hispanic workers are less productive than white workers, prior to interacting with any workers. I refer to these employers as biased employers. The data also show that there exists a negative hiring gap for both Black and Hispanic workers as compared to workers, showing evidence of discrimination. Finally, I find spillovers across minorities in both directions: the hiring of Hispanic workers increases after hiring experiences with Black workers, and the hiring of Black workers increases after hiring experiences with Hispanic workers. However, while the spillovers from Hispanic to Black workers hold also for the biased employers, the hiring spillovers observed from Black to Hispanic workers only hold for non-biased employers. In other words, employers that are ex-ante biased against minority workers are unaffected by their experiences with Black workers when hiring Hispanic workers.Managerial Disrespect and Employee Effort at Work: An Empirical Analysis
Abstract
We study how a key element of manager interpersonal skills—respect—impacts employees’ work efforts using a unique individual-level monthly data set from a retail chain. The chain has a practice in which store managers personally hand a birthday gift to employees on their birthdays. We exploit an unintentional and unexpected shock of receiving a late birthday gift to identify a causal effect of a disrespectful event at work. We find that receiving a late birthday gift is associated with a detrimental effect on employees’ work effort, resulting in a 48% increase in sickness absences and a reduction of over three working hours per month. This decrease in work effort is particularly evident among females and employees in managerial positions. Our study shows that by restoring their interpersonal skills, managers can repair their relationship with employees.Search Costs, Outside Options, and On-the-Job Search
Abstract
I study how beliefs about search costs, returns to search effort, and outside options relate to the job mobility decisions of employed workers. I design an online survey and administer it to a representative sample of wage and salaried workers in the US. In the survey, I directly measure employed workers’ perceptions of search costs—time, money, stress—and the perceived returns to their job search effort—the expected success rate of their job applications. I also elicit workers’ beliefs about their opportunities outside of their current job and measure their knowledge of the wage distribution in their occupation. I document significant heterogeneity in expectations across demographic groups. Women expect higher costs and lower returns to effort. I find that beliefs about outside options and returns to effort are strong predictors of job search intentions. In addition, respondents who expect to spend more time looking for job openings have a lower propensity to search, consistent with the relevance of information frictions. Using two information experiments, I show that accurate information about the median wage does not shift search intentions, while positive information on the recent search experience of similar workers is more effective for groups that are more worried about search costs.Toxic Managers, Firm Productivity, and Worker Well-Being: Evidence from Bangladeshi Garment Factories
Abstract
We show that toxic workplace cultures, characterized by authoritarian managerial practices and excessive overtime, partly stem from managers lacking general soft skills. We randomly assigned garment factory supervisors to one of three groups: soft skills training, featuring emotion regulation, problem-solving, and effective communication; health literacy training, focused broadly on lifestyle choices that improve health; or no intervention. Soft skills training increased worker productivity and reduced overtime, leaving psychological well-being unchanged despite the reduction in overtime pay. Unexpectedly, health education made supervisors less authoritarian and improved worker well-being, but at the expense of work quality. We hypothesize that by improving health literacy, trainees prioritized personal well-being over meeting supervisory role expectations, shaping their managerial style. Our findings underscore that reducing workplace toxicity can, but does not always, increase worker well-being and productivity. Furthermore, our interventions did not reduce verbal abuse, which many supervisors consider essential to deter worker complacency.Worker Heterogeneity and Immigration Policy Inefficiencies
Abstract
In high-skilled industries, acquisition of talented workers is crucial for firms' success. In the US, foreign skilled workers are often a vital source of highly-specialized skills in this sector, and yet firms are limited in their ability to hire these workers. In the absence of policy frictions, firms would interview the most promising candidates of all nationalities and then accept those with the highest expected benefit to the firm. Under the restrictions of the H-1B visa program, firms choose to hire foreign skilled workers who have high expected productivity, but they are only allowed to hire the workers if they receive a successful visa petition.This process leads to two sources of inefficiency. First, the uncertainty around foreign workers' visa petition and the costliness of filing it imply that the marginal domestic hire would have a lower expected productivity than the marginal foreign hire. In the absence of these frictions, the marginal productivities should be equal. Second, the visa process grants petitions on a worker-level basis rather than at the firm level. This means that the firm's most-preferred candidate has the same probability of being accepted as the firm's least-preferred candidate.
In this paper, we quantify these inefficiencies using a heterogeneous-worker model. Firms receive a noisy signal about the productivity of applicants, who may be domestic or foreign. Hiring a foreign worker requires additional costs and uncertainty meant to capture the H-1B process. Firms hire applicants with a productivity signal above a cutoff threshold, which varies endogenously by nationality of the candidate. We use the model to quantify the impact of the visa program on productivity and evaluate a counterfactual in which firms are allowed to rank candidates and receive their highest rated candidates first.
JEL Classifications
- J0 - General