Human Resource Management Policies and Productivity: New Evidence from An Econometric Case Study

First we distinguish various approaches used by economists toassess the impact of human resource management practices onproductivity and then we briefly review and illustrate studiesthat represent different approaches. In the main part of thepaper we illustrate the econometric case study method, by usingnew data to analyse a case from retail trade and by emulatingan approach used in an earlier study. Consistent with theorywe find that when employees have opportunities to participate,and to receive appropriate information and pertinent rewards,a one standard deviation increase of the first principal componentscore would increase productivity by 1 per cent. Our findingsimply that there are benefits to innovative work practices,even in settings where employees do simple tasks and employeesare relatively low-skilled. Since our findings are similar tothose contained in a previous study, our results also indicatethe value of replication studies. Footnotes ¹ E-mail addresses: djones{at}hamilton.edu; panu.kalmi{at}hse.fi; antti.kauhanen{at}hse.fi     

Productivity dispersion: A case study

This paper studies productivity dispersion in a retail chain. We find that productivity is highly dispersed between the branches. Furthermore, productivity rankings are quite persistent. Accounting for employee skills and human resource management decreases the productivity dispersion only slightly. The results suggest that productivity dispersion is “real”.     

Does job design make workers happy?

Using linked employer-employee data for Finland we examine associations between job design, employee well-being and job-related stress. Three key findings stand out. First, in accordance with the theory of Karasek and Karasek and Theorell, job control and supervisory support are positively correlated with employee well-being and negatively correlated with job-related stress. Second, as predicted by theory, job demands are positively correlated with job-related stress. Third, there is no association between job demands and employee well-being and, contrary to expectations, neither job control nor supervisory support alleviate the negative relationship between job demands and job-related stress. Our results confirm the importance of job design for employee well-being.     

The index premium and its hidden cost for index funds

This paper empirically investigates the index premium and its implications from 1990 to 2005. For additions to the S&P 500 and Russell 2000, we find that the price impact from announcement to effective day has averaged + 8.8% and + 4.7%, respectively, and −15.1% and −4.6% for deletions. The premia have been growing over time, peaking in 2000, and declining since then. The implied price elasticity of demand increases with firm size and decreases with idiosyncratic risk, supporting theoretical predictions. We also introduce a new concept that we label the index turnover cost, which represents a hidden cost borne by index funds (and the indexes themselves) due to the index premium. We illustrate this cost and estimate its lower bound as 21-28 bp annually for the S&P 500 and 38-77 bp annually for the Russell 2000.     

Aligning Misaligned Systemic Innovations: Probing Inter‐Firm Effects Development in Project Networks

Implementing systemic innovations in a project network can significantly improve its performance; however, implementing systemic innovations is difficult if project network structures misalign to the innovation. Little research has examined how project network structures can align to systemic innovations. To address this research gap, we studied an advanced building information modeling tool implemented in a Finnish design and development project network. We found that misaligned innovations are aligned through a process of task sequence alignment, knowledge base alignment, and work allocation alignment. Our findings are important; they suggest that implementing systemic innovations in project networks is a multistage inter‐firm process.     

Is corruption grease,grit or a gamble? Corruption increases variance of productivity across countries

The effect of corruption on economic growth has attracted interest in empirical development economics. The conventional view of corruption as impediment for growth has been challenged by the ‘grease-on-the-wheels’ hypothesis. We take a new perspective on the issue and suggest corruption as macro risk, referred to as a ‘gamble’ hypothesis. Using cross-country data and two alternative indicators of corruption, we find corruption to be a significant driver of heteroscedasticity in total productivity. This supports the new gamble hypothesis. We also note some misleading interpretations in the previously published frontier applications. To avoid these shortcomings, we apply a flexible semi-nonparametric estimator.