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Effort-Based Career Opportunities and Working Time

  • Massimiliano BRATTI

    ()

    (Universit… di Milano, DEAS)

  • Stefano STAFFOLANI

    ()

    (Universita' Politecnica delle Marche, Dipartimento di Economia)

The authors evaluate the economic effects of the hypothesis of effort-based career opportunities, described as a situation in which a firm creates incentives for employees to work longer hours than bargained (or desired), by making career prospects depend on relative working hours. Firms' personnel management policies may tend to increase working time (or workers' effort) in order to maximize profits. Effort-based career opportunities raise working time, production and output per worker, and reduce workers' utility. The authors make a first attempt to empirically estimate the relationship between hours worked and the expected opportunities of promotion using the British Household Panel Survey data set. Their analysis shows that the perceived probability of promotion increases with working time, and that this result is robust to various econometric specifications.

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Paper provided by Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali in its series Working Papers with number 203.

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Length: 22
Date of creation: Feb 2004
Date of revision:
Handle: RePEc:anc:wpaper:203
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  1. J. A. Hausman, 1976. "Specification Tests in Econometrics," Working papers 185, Massachusetts Institute of Technology (MIT), Department of Economics.
  2. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  3. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2003. "A sticky floors model of promotion, pay, and gender," European Economic Review, Elsevier, vol. 47(2), pages 295-322, April.
  4. Bell, Linda A. & Freeman, Richard B., 2001. "The incentive for working hard: explaining hours worked differences in the US and Germany," Labour Economics, Elsevier, vol. 8(2), pages 181-202, May.
  5. Arulampalam, W. & Robin A. Naylor & Jeremy P. Smith, 2002. "University of Warwick," Royal Economic Society Annual Conference 2002 9, Royal Economic Society.
  6. Landers, Renee M & Rebitzer, James B & Taylor, Lowell J, 1996. "Rat Race Redux: Adverse Selection in the Determination of Work Hours in Law Firms," American Economic Review, American Economic Association, vol. 86(3), pages 329-48, June.
  7. Chamberlain, Gary, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 225-38, January.
  8. Stewart, M.B. & Swaffield, J.K., 1996. "Constraints on the Desired Hours of Work of British Men," The Warwick Economics Research Paper Series (TWERPS) 468, University of Warwick, Department of Economics.
  9. Edward P. Lazear & Paul Oyer, 2003. "Internal and External Labor Markets: A Personnel Economics Approach," NBER Working Papers 10192, National Bureau of Economic Research, Inc.
  10. Edward P. Lazear & Sherwin Rosen, 1979. "Rank-Order Tournaments as Optimum Labor Contracts," NBER Working Papers 0401, National Bureau of Economic Research, Inc.
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