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Does high involvement management lead to higher pay?

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  • Böckerman, Petri
  • Bryson, Alex
  • Ilmakunnas, Pekka

Abstract

Using nationally representative survey data for Finnish employees linked to register data on their wages and work histories we find wage effects of high involvement management (HIM) practices are generally positive and significant. However, employees with better wage and work histories are more likely to enter HIM jobs. The wage premium falls substantially having accounted for employees’ work histories suggesting that existing studies’ estimates are upwardly biased due to positive selection into HIM. Results do not differ significantly when using propensity score matching as opposed to standard regression techniques. The premium rises with the number of HIM practices and differs markedly across different types of HIM practice.

Suggested Citation

  • Böckerman, Petri & Bryson, Alex & Ilmakunnas, Pekka, 2011. "Does high involvement management lead to higher pay?," LSE Research Online Documents on Economics 38575, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:38575
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    References listed on IDEAS

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    Cited by:

    1. Michael Barry & Alex Bryson & Rafael Gomez & Bruce Kaufman & Guenther Lomas & Adrian Wilkinson, 2018. "The ''Good Workplace'': The Role of Joint Consultative Committees, Unions and HR policies in Employee Ratings of Workplaces in Britain," DoQSS Working Papers 18-08, Department of Quantitative Social Science - UCL Institute of Education, University College London.
    2. Alex Bryson & Lucy Stokes & David Wilkinson, 2018. "Is Pupil Attainment Higher in Well-managed Schools?," DoQSS Working Papers 18-09, Department of Quantitative Social Science - UCL Institute of Education, University College London.
    3. Petri Böckerman & Alex Bryson & Antti Kauhanen & Mari Kangasniemi, 2016. "Does Job Support Make Workers Happy?," DoQSS Working Papers 16-16, Department of Quantitative Social Science - UCL Institute of Education, University College London.
    4. Laszlo Goerke, 2016. "Sick Pay Reforms and Health Status in a Unionised Labour Market," IAAEG Discussion Papers until 2011 201604, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    5. repec:iza:izawol:journl:2018:n:447 is not listed on IDEAS
    6. Michael White & Alex Bryson, 2018. "HPWS in the Public Sector: Are There Mutual Gains?," DoQSS Working Papers 18-10, Department of Quantitative Social Science - UCL Institute of Education, University College London.
    7. repec:spr:empeco:v:56:y:2019:i:1:d:10.1007_s00181-017-1351-1 is not listed on IDEAS
    8. Joseph Blasi & Richard Freeman & Douglas Kruse, 2016. "Do Broad-based Employee Ownership, Profit Sharing and Stock Options Help the Best Firms Do Even Better?," British Journal of Industrial Relations, London School of Economics, vol. 54(1), pages 55-82, March.
    9. Kato, Takao & Kodama, Naomi, 2017. "Women in the Workplace and Management Practices: Theory and Evidence," IZA Discussion Papers 10788, Institute for the Study of Labor (IZA).
    10. Böckerman, Petri & Ilmakunnas, Pekka, 2017. "Do Good Working Conditions Make You Work Longer? Evidence on Retirement Decisions Using Linked Survey and Register Data," IZA Discussion Papers 10964, Institute for the Study of Labor (IZA).
    11. Petri Böckerman, 2015. "High involvement management and employee well-being," IZA World of Labor, Institute for the Study of Labor (IZA), pages 171-171, July.

    More about this item

    Keywords

    wages; high involvement management; high performance work system; incentive pay; training; team working; information sharing; propensity score matching;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M50 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - General
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M53 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Training
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management

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