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The Response of Worker Effort to Piece Rates: Evidence from the Midwest Logging Industry

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  • M. Ryan Haley
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    Abstract

    Using firm-level payroll data from the Midwest logging industry, I compute a worker’s productivity response to a change in piece-rate pay, an elasticity of effort, using an empirical specification developed in Paarsch and Shearer (1999). Maximum-likelihood estimation of an agency-based structural econometric model of worker choice yields elasticities ranging from 0.413 to 1.507. These estimates are smaller than, but qualitatively similar to, those reported in Paarsch and Shearer, suggesting that their model has perhaps more general applicability than their British Columbia tree-planting example.

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    File URL: http://jhr.uwpress.org/cgi/reprint/XXXVIII/4/881
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    Bibliographic Info

    Article provided by University of Wisconsin Press in its journal Journal of Human Resources.

    Volume (Year): 38 (2003)
    Issue (Month): 4 ()
    Pages:

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    Handle: RePEc:uwp:jhriss:v:38:y:2003:i:4:p881-890

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    Web page: http://jhr.uwpress.org/

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    Cited by:
    1. Hyejin Ku, 2014. "Fair Trade in the Fields of Florida: The Impact of the Penny-Per-Pound on Tomato Pickers," CReAM Discussion Paper Series 1416, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    2. Paarsch, Harry J. & Shearer, Bruce S., 2007. "Do women react differently to incentives? Evidence from experimental data and payroll records," European Economic Review, Elsevier, vol. 51(7), pages 1682-1707, October.
    3. Keith Bender & Colin Green & John Heywood, 2012. "Piece rates and workplace injury: Does survey evidence support Adam Smith?," Journal of Population Economics, Springer, vol. 25(2), pages 569-590, January.
    4. Harry J. Paarsch & Bruce S. Shearer, 2004. "Male-Female Productivity Differentials: the Role of Ability and Incentives (revised)," Cahiers de recherche 0410, CIRPEE.
    5. Harry J. Paarsch & Bruce S. Shearer, 2004. "Male-Female Productivity Differentials: The Role of Ability and Incentives," CIRANO Working Papers 2004s-17, CIRANO.
    6. Rupayan Pal, 2005. "Choice of union-firm bargaining agenda and social welfare," Public Economics 0507014, EconWPA.

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