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Incentives in a (Czech?) Bank

Incentives in a (Czech?) Bank. by Bogaard and Svejnar. HRM effects in services.

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Incentives in a (Czech?) Bank

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  1. Incentives in a (Czech?) Bank by Bogaard and Svejnar

  2. HRM effects in services • Ann Bartel 2004 ILLR (100 citations in GS) Branches of a Canadian bank, branch manager decides on HRM (incentives, participation, skills), 2 periods, controls for manager quality using employee survey: sales annual % change= f(K, L, HRM, branch_age, MgrTenure, MarketX, FE_year, FE_branch, FE_mgr ) • Ichniowski&Shaw: insider econometrics: is the goal to measure adoption effect in a randomly chosen branch or early adopters?

  3. Literature • Evidence on HPWP: makes productivity go up as well as wages and job satisfaction, profits don't change much, more likely to be adopted when skilled labor is abundant. • Strategies: unit FE, time varying IV using industry adoption of HPWP from another country, matching.

  4. Bogaard and Svejnar This is not HPWP, but basic specialization. (+) Nice new data, alternative empirical strategies (IV, matching), lots of robustness checks, model to aid interpretation. 56 pages (and I’ll ask for 10 more). Wow. (-) Whole lotta IVing going on, head swimming. Stress on foreign/domestic in CEE in 2003-07? Magnitude of IV estimates huge (2x s.d.?).

  5. Experiment Region and size explain adoption. Bankers and advisors a different treatment. Need more info on the design (var in X): • Was this a surprise? Not much pre- data. • Who chose order of implementation? (within size or regional groups) In particular, early adoption (in t=1) as pilot in best branches, low hanging fruit within & across branches?

  6. IV strategy • IV idea: Regional/size adoption. Sequencing? • Then add size to both first and second stage? • IV is not similar to matching: IV is an across- group comparison (averaging unobs. within groups) zooming in on late adopters (LATE), whilst matching compares within groups. • Show missing 500 obs., first stage F tests, pscore estimation, common support, balancing tests, dif-in-difs w/ matching implementation (within group pscore?) etc.

  7. Minor Questions • Free riding or lower returns to late adopters? • Care about side payments? • Take out advisors in small branches in 2006? • Can do better on local demand? Un. rates? • No info on new footing (flow)? • Study effect on wages? • Must look at bad loans over time.

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