Moral hazard and moral motivation: Corporate social responsibility as labor market screening
AbstractMorally motivated individuals behave more cooperatively than predicted by standard theory. Hence,if a firm can attract workers who are strongly motivated by ethical concerns, moral hazard problems like shirking can be reduced. We show that employers may be able to use the firm’s corporate social responsibility profile as a screening device to attract more productive workers. Both pooling and separating equilibria are possible. Even when a substantial share of the workers have no moral motivation whatsoever, such screening may in fact drive every firm with a low social responsibility profile out of business.
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Bibliographic InfoPaper provided by Oslo University, Department of Economics in its series Memorandum with number 25/2004.
Length: 32 pages
Date of creation: 06 Apr 2005
Date of revision:
Publication status: Published in Resource and Energy Economics, 2008, pages 509-526.
Contact details of provider:
Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
Web page: http://www.oekonomi.uio.no/indexe.html
More information through EDIRC
Self-image; teamwork; shirking; voluntary abatement;
Find related papers by JEL classification:
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
This paper has been announced in the following NEP Reports:
- NEP-ACC-2005-04-16 (Accounting & Auditing)
- NEP-ALL-2005-04-16 (All new papers)
- NEP-LTV-2005-04-16 (Unemployment, Inequality & Poverty)
- NEP-MIC-2005-04-16 (Microeconomics)
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