Do Train‐or‐Pay Schemes Really Increase Training Levels?

Reacting to perceived market failures leading to under‐optimal levels of firm‐sponsored training, governments all over the world have stepped in with various policy instruments to alleviate this problem, using incentives such as regulation or co‐financed schemes directed at firms or at individuals. Despite the widespread use of these schemes, rigorous empirical evaluation of such policies is uncommon. In this paper, we provide a careful evaluation of a reform in a train‐or‐pay scheme used in Canada that exempted medium‐sized workplace from the training requirement. Our identification strategy involves comparing changes in training levels in medium‐sized workplaces, before and after the reform, to changes for both smaller and larger workplaces. We also compare relative changes in training intensities to those observed in a neighboring province in which no such changes took place. We find the policy had no impact on training levels but caused firms to change their human capital investments portfolio, substituting informal and formal training.     

Why Do REIT Returns Poorly Reflect Property Returns? Unrealizable Appreciation Gains due to Trading Constraints as the Solution to the Short‐Term Disparity

This study addresses the short‐term disparity between REIT returns and direct property returns, and argues that this phenomenon is due to the trading constraints in the direct property market imposed on REITs (the dealer rule). This renders REITs unable to time markets in order to realize short‐term property appreciation profits, making REITs primarily a property income investment rather than a full property investment, and explains the observed disparity. Empirically, I find that REIT returns consistently reflect property income returns, but not property appreciation returns. This makes this study the first in the literature to find a consistent link between REIT returns and any portion of direct property returns at short time horizons, in the context of a linear factor model. I then set up a natural laboratory to test the trading‐constraints explanation by examining the appreciation dependence of different types of REITs, which should be differently affected by the trading constraints. I find that returns to UPREITs, which are less affected by the constraints, have a stronger appreciation dependence than returns to regular REITs. I also perform a size test and find that large REITs, which are less affected by the constraints, have a stronger appreciation dependence than small REITs. When testing the effects of UPREIT and size characteristics simultaneously, I find a consistent UPREIT effect. I further find that Real Estate Operating Companies (REOCs), which are not subject to trading constraints, show short‐term property appreciation dependence. These findings offer strong support for the trading‐restrictions explanation.     

Publication Selection Bias in Minimum‐Wage Research? A Meta‐Regression Analysis

Card and Krueger's meta-analysis of the employment effects of minimum wages challenged existing theory. Unfortunately, their meta-analysis confused publication selection with the absence of a genuine empirical effect. We apply recently developed meta-analysis methods to 64 US minimum-wage studies and corroborate that Card and Krueger's findings were nevertheless correct. The minimum-wage effects literature is contaminated by publication selection bias, which we estimate to be slightly larger than the average reported minimum-wage effect. Once this publication selection is corrected, little or no evidence of a negative association between minimum wages and employment remains.     

Pro‐Social or Pro‐Management? A Critique of the Conception of Employee Voice as a Pro‐Social Behaviour within Organizational Behaviour

For many years, the employment relations (ER) literature took the perspective that employee voice via trade unions could channel discontent and reduce exit, thereby improving productivity. In organizational behaviour (OB) research voice has also emerged as an important concept, and a focus of this research has been to understand the antecedents of the decision of employees to engage or not engage in voice. In OB research, however, voice is not viewed as it is in ER as a mechanism to provide collective representation of employee interests. Rather, it is seen as an expression of the desire and choice of individual workers to communicate information and ideas to management for the benefit of the organization. This article offers a critique of the OB conception of voice, and in particular highlights the limitations of its view of voice as a pro‐social behaviour. We argue that the OB conception of voice is at best partial because its definition of voice as an activity that benefits the organization leaves no room for considering voice as a means of challenging management, or indeed simply as being a vehicle for employee self‐determination.     

Does Wage Rank Affect Employees’ Well‐being?

How do workers make wage comparisons? Both an experimental study and an analysis of 16,000 British employees are reported. Satisfaction and well‐being levels are shown to depend on more than simple relative pay. They depend upon the ordinal rank of an individual's wage within a comparison group. “Rank” itself thus seems to matter to human beings. Moreover, consistent with psychological theory, quits in a workplace are correlated with pay distribution skewness.     

Does complexity deter customer‐focus?

Economic models suggest that firms use a simple cost‐benefit calculation to evaluate customer requests for new product features, but an extensive organizational literature shows the decision to implement innovation is more nuanced. We address this theoretical tension by studying how firms respond to customer requests for incremental product innovations, and how these responses change when the requested innovation is complex. Using large sample empirical analyses combined with detailed qualitative data drawn from interviews, we find considerable variance in the relationship between customer demands, complexity, and investments in incremental innovations. The qualitative study revealed the importance of organization structures, competitive pressures, and incentives for resource allocation processes. Copyright © 2011 John Wiley & Sons, Ltd.     

The Gender Gap in Funeral Directors: Burying Women with Ready‐to‐Embalm Laws?

Over the last few decades, the gender composition of funeral directors in the United States has changed dramatically as women have entered this traditionally male‐dominated occupation. To practise as funeral directors, women (and men) must be licensed in all but one state. The most extensive training requirements exist in the 27 states with ‘ready‐to‐embalm’ laws, which require funeral directors to be embalmers. Using a sample of 45,989 licensing records from 40 states, we find that 18.1 per cent of funeral directors were women in 2006. However, the proportion is significantly lower in states with ready‐to‐embalm laws. Our regressions imply that these laws reduce the proportion of female funeral directors by 24 per cent. More generally, we find that the number of funeral directors per capita is 17 per cent lower, on average, in states with ready‐to‐embalm laws.     

Going short‐term or long‐term? CEO stock options and temporal orientation in the presence of slack

Research summary: We draw on behavioral agency theory to explain how decision heuristics associated with CEO stock options interact with firm slack to shape the CEO's preference for short‐ or long‐term strategies (temporal orientation). Our findings suggest CEO current option wealth substitutes for the influence of slack resources in encouraging a long‐term orientation, while prospective option wealth enhances the positive effect of slack on temporal orientation. Our theory offers explanations for non‐findings in previous analysis of the relationship between CEO equity based pay and temporal orientation and provides the insights that CEO incentives created by stock options (1) enhance the effect of available slack upon temporal orientation and (2) can both incentivize and de‐incentivize destructive short‐termism, depending upon the values of current and prospective option wealth. Managerial summary: We explore how compensation design can play a role in affecting the CEO's preference for short‐ or long‐term strategic projects. When the CEOs have accumulated option wealth, they are more likely to invest in the long term. Yet when they have a large number of recently granted options with the potential to generate significant wealth in the event of successful risk taking, the CEO is more likely to prefer the short term in order to achieve personal wealth gains more quickly. The more liquid assets the firm holds, the weaker both of the aforementioned effects. An implication for boards is that they should anticipate CEO short‐termism if the CEO has been granted new options, underlining the potential negative consequences of option compensation. Copyright © 2015 John Wiley & Sons, Ltd.     

Informal Employment Dispute Resolution among Low‐Wage Non‐Union Workers: Does Managerially Initiated Workplace Voice Enhance Equity and Efficiency?

The decline of collective industrial relations has shifted the focus of industrial relations research to the study of individual employment disputes. In this article, we investigate whether employer‐initiated workplace voice is associated with improved resolution of individual complaints or grievances workers make against employers. We find that our measure of workplace voice is associated with less serious problems, more informal methods of dispute resolution, more satisfactory outcomes for workers and lower quit rates. However, these findings need to be set against generally low rates of satisfactory dispute resolution for all employees in our sample.     

How Costly is Hospital Quality? A Revealed‐Preference Approach

We analyze the cost of quality improvement in hospitals, dealing with two challenges. Hospital quality is multidimensional and hard to measure, while unobserved productivity may influence quality supply. We infer the quality of hospitals in Los Angeles from patient choices. We then incorporate ‘revealed quality’ into a cost function, instrumenting with hospital demand. We find that revealed quality differentiates hospitals, but is not strongly correlated with clinical quality. Revealed quality is quite costly, and tends to increase with hospital productivity. Thus, non-clinical aspects of the hospital experience (perhaps including patient amenities) play important roles in hospital demand, competition, and costs.     

Are family‐friendly workplace practices a valuable firm resource?

We study the determinants and consequences of family‐friendly workplace practices (FFWP) using a sample of over 450 manufacturing firms in Germany, France, U.K., and U.S. We find a positive correlation between firm productivity and FFWP. This association disappears, however, once we control for a measure of the quality of management practices. We further find that firms with a higher proportion of female managers and more skilled workers, as well as well‐managed firms, tend to implement more FFWP. Conversely, a firm's environment does not have a significant impact on the FFWP it provides. © 2010 The Authors. Strategic Management Journal published by John Wiley & Sons, Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.     

Foreign‐born academic scientists: entrepreneurial academics or academic entrepreneurs?

Although foreign‐born scholars make up a significant portion of the US professoriate, little is known about how their ‘foreign‐born’ identity directly or indirectly affects their entrepreneurial prowess. This article integrates role identity theory with theoretical arguments from social network and cultural proximity theories to examine whether foreign‐born academic scientists can better be characterized as entrepreneurial academics (strong government grant productivity) or academic entrepreneurs (strong involvement in the creation and commercialization of university‐invented technologies). Our analysis indicates that foreign‐born academic scientists seem more successful in attracting research resources, but are less successful in exploiting their inventions through entrepreneurial activities. They can therefore be best described as entrepreneurial academics. These findings may partially explain the tepid performance of many research‐intensive universities in terms of technology transfer and commercialization. We discuss the policy implications of our findings and provide guidance for academic entrepreneurs.     

When Is Employee Retaliation Acceptable at Work? Evidence from Quasi‐Experiments

When is employee retaliation acceptable in the workplace? We use a quasi‐experimental design to study the acceptability of several forms of retaliatory behavior at work, gathering data in this untested area. Consistent with hypotheses from theories of fairness, we find that employee retaliation in the workplace is perceived to be more acceptable if it is an act of omission instead of an act of commission. We do not find that a more damaging retaliatory act is significantly less acceptable than a less damaging one, suggesting a qualitative rather than a quantitative relationship. We also find individual differences: Respondents who are older, female, politically conservative, and managers typically show less tolerance for retaliation, while union members are a bit more accepting than average.