Paid to Quit
| Autor: | Robert Dur, Heiner Schmittdiel |
|---|---|
| Přispěvatelé: | Economics |
| Jazyk: | angličtina |
| Rok vydání: | 2019 |
| Předmět: |
Economics and Econometrics
050208 finance Transparency (market) media_common.quotation_subject 05 social sciences Principal (computer security) Adverse selection intrinsic motivation commitment self-selection wage compensation exit bonus transparency jel:J31 Microeconomics Surprise jel:M55 jel:J33 jel:M52 Order (business) 0502 economics and business Intrinsic motivation Business 050207 economics Function (engineering) media_common Public finance |
| Zdroj: | De Economist, 167(4), 1-20. Springer Netherlands |
| ISSN: | 1572-9982 0013-063X |
| Popis: | Inspired by a recent observation about an online retail company, this paper explains why a firm may find it optimal to offer an exit bonus to recent hires so as to induce self-selection. We study a double adverse selection problem, in which the principal can neither observe agents’ commitment to the job nor their intrinsic motivation. A steep wage-tenure profile deters uncommitted agents from applying. An exit bonus can stimulate that –among the committed agents– those who discovered that they are not intrinsically motivated for the job discontinue employment with the principal. Our key findings are that offering an exit bonus increases profits when the first adverse selection problem is sufficiently severe compared to the second and that the exit bonus needs to come as a surprise for the agents in order to function well. |
| Databáze: | OpenAIRE |
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