Wage policy, employee turnover and productivity

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dc.contributor.author Chevalier, Arnaud
dc.contributor.author Siebert, W. S.
dc.contributor.author Viitanen, Tarja
dc.date.accessioned 2010-02-25T15:06:30Z
dc.date.available 2010-02-25T15:06:30Z
dc.date.issued 2003-05-31
dc.identifier.uri http://hdl.handle.net/10197/1885
dc.description.abstract In this paper, we are interested in the effect of pay incentives on labour turnover and productivity. Particularly we use personnel data from a panel of 400 shops from a UK retail chain. The firm uses perfectly flat hourly wage system with no reward for tenure or individual productivity. This system leads to the phenomenon of negative selection, where only employees with lower outside options remain with the firm. We show that negative selection conflicts with human capital so that the relationship between employee turnover and productivity is U-shaped. If negative selection is as important as human capital accumulation in accounting for the U-shape, then devising a wage policy that will reduce negative selection could increase labour productivity considerably. en
dc.format.extent 902057 bytes
dc.format.mimetype application/pdf
dc.language.iso en en
dc.publisher University College Dublin. Institute for the Study of Social Change (Geary Institute) en
dc.relation.ispartofseries ISSC Discussion Paper Series en
dc.relation.ispartofseries WP2003/08 en
dc.subject Employee turnover en
dc.subject Productivity en
dc.subject.classification J22 en
dc.subject.classification J3 en
dc.subject.lcsh Labor turnover en
dc.subject.lcsh Wages and labor productivity en
dc.subject.lcsh Retail trade--Great Britain en
dc.title Wage policy, employee turnover and productivity en
dc.type Working Paper en
dc.internal.availability Full text available en
dc.internal.webversions http://www.ucd.ie/geary/publications/2003/turnover4.pdf en
dc.status Not peer reviewed en
dc.neeo.contributor Chevalier|Arnaud|aut| en
dc.neeo.contributor Siebert|W. S.|aut| en
dc.neeo.contributor Viitanen|Tarja|aut| en

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