Incentives, Selection and Productivity in Labor Markets: Evidence from Rural Malawi / Raymond P. Guiteras, B. Kelsey Jack.

Format:

Book

Author/Creator:

Guiteras, Raymond P.

Contributor:

National Bureau of Economic Research.

Jack, B. Kelsey.

Series:

Working Paper Series (National Bureau of Economic Research) no. w19825.

NBER working paper series no. w19825

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Incentives, Selection and Productivity in Labor Markets

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2014.

Summary:

An observed positive relationship between compensation and productivity cannot distinguish between two channels: (1) an incentive effect and (2) worker selection. We use a simplified Becker-DeGroot-Marschak mechanism, which provides random variation in piece rates conditional on revealed reservation rates, to separately identify the two channels in the context of casual labor markets in rural Malawi. A higher piece rate increases output in our setting, but does not attract more productive workers. Among men, the average worker recruited at higher piece rates is actually less productive. Local labor market imperfections appear to undermine the worker sorting observed in well-functioning labor markets.

Notes:

Print version record

January 2014.