Worker Sorting, Work Discipline and Development

Lead Research Organisation: Institute for Financial Management & Res
Department Name: Small Enterprise Finance Centre (SEFC)

Abstract

We expect the long-term beneficiaries of the research outcome to be the underemployed, low skilled population, including a significant number of women. It is this group who could potentially increase their livelihoods if policymakers could design better industrial policies to generate a larger number of employment opportunities for this group. In addition, by understanding better the characteristics of employees and their productivity, we anticipate that this research will aid human resources and management decisions at the firm-level and better tailor jobs to specific segments of the population.

In pursuing high-quality research, a major target audience is the academic community. The outcome of the study will influence our understanding of productivity differences within countries, crucial to understanding how to generate economic growth. With analytically-driven, evidence based results we hope to assist donors, in prioritizing interventions that can achieve higher returns, thus helping to create a more efficient foreign aid establishment.

- Strategy and methods for engagement of policy makers throughout the project: We intend to engage with policymakers at various stage of the project. To reach out to policy makers, we will produce a policy brief to be disseminated, invite high-level administrators to conferences where research will be discussed at conferences, as well as directly interact with relevant government authorities about the research findings. To promote policy output among the research community, we expect to have our results published in a highly respected peer-reviewed journal of economics, thus exposing numerous researchers to the ideas influencing further research and the methodology underlining it. Furthermore, the research will be presented at various relevant economic seminars. We aim to promote the research extensively within our research network associations with SME Initiative at Innovations for Poverty Action, Ideas42 as well as other formal and informal channels in various government and non-governmental organizations in which our research outcomes are used to inform policy decisions

- Monitoring and Evaluation of Impact Plan activities: First and more long-term - the findings will be shared with policy makers via conferences, policy briefs, communication (and maintained relationships) with multilateral agencies, government (national and local) as well as employers' representatives, and could eventually translate into an industrial policy. Second and immediate - the direct beneficiaries, who are the people targeted to work as data entry operators, will undertake a training and obtain a certificate whether they are selected or not for the job. Third, the research methodology itself will add to the growing practice of Randomized Control Trials experiments, adding to the knowledge and understanding of this methodology as a rigorous and increasingly recognized approach of applied research and field work (reference 1). The findings will also be disseminated during internal and external seminars, training sessions of research associates as a case study, in specialized websites (reference 2) , newsletters, policy briefs, and scrutinized by peers through academic conferences. The research outcomes will stand as an invitation for further specific research projects in the development field using this rigorous methodology as well as focusing on these particular aspects of labor productivity, work organization and self-selection in the context of developing economies.

Planned Impact

We expect the long-term beneficiaries of the research outcome to be the underemployed, low skilled population, including a significant number of women. It is this group who could potentially increase their livelihoods if policymakers could design better industrial policies to generate a larger number of employment opportunities for this group. In addition, by understanding better the characteristics of employees and their productivity, we anticipate that this research will aid human resources and management decisions at the firm-level and better tailor jobs to specific segments of the population.

In pursuing high-quality research, a major target audience is the academic community. The outcome of the study will influence our understanding of productivity differences within countries, crucial to understanding how to generate economic growth. With analytically-driven, evidence based results we hope to assist donors, in prioritizing interventions that can achieve higher returns, thus helping to create a more efficient foreign aid establishment.

- Strategy and methods for engagement of policy makers throughout the project: We intend to engage with policymakers at various stage of the project. To reach out to policy makers, we will produce a policy brief to be disseminated, invite high-level administrators to conferences where research will be discussed at conferences, as well as directly interact with relevant government authorities about the research findings. To promote policy output among the research community, we expect to have our results published in a highly respected peer-reviewed journal of economics, thus exposing numerous researchers to the ideas influencing further research and the methodology underlining it. Furthermore, the research will be presented at various relevant economic seminars. We aim to promote the research extensively within our research network associations with SME Initiative at Innovations for Poverty Action, Ideas42 as well as other formal and informal channels in various government and non-governmental organizations in which our research outcomes are used to inform policy decisions

- Monitoring and Evaluation of Impact Plan activities: First and more long-term - the findings will be shared with policy makers via conferences, policy briefs, communication (and maintained relationships) with multilateral agencies, government (national and local) as well as employers' representatives, and could eventually translate into an industrial policy. Second and immediate - the direct beneficiaries, who are the people targeted to work as data entry operators, will undertake a training and obtain a certificate whether they are selected or not for the job. Third, the research methodology itself will add to the growing practice of Randomized Control Trials experiments, adding to the knowledge and understanding of this methodology as a rigorous and increasingly recognized approach of applied research and field work (reference 1). The findings will also be disseminated during internal and external seminars, training sessions of research associates as a case study, in specialized websites (reference 2) , newsletters, policy briefs, and scrutinized by peers through academic conferences. The research outcomes will stand as an invitation for further specific research projects in the development field using this rigorous methodology as well as focusing on these particular aspects of labor productivity, work organization and self-selection in the context of developing economies.

Publications

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Description We followed the plan laid out previously and were expecting to hire the entire required sample of 300 DEOs with 3 rounds of hiring. But once we started the hiring process we faced some issues which have created a few delays in achieving the required sample size. But we have been successful in addressing these issues which are described in detail further below.

Attrition: Starting from wave 1, we observed a considerable number of candidates dropping out despite being offered a Job. While the overall turnover and attrition in the industry is high, we were faced with several months of severe disruptions and protests in Chennai (the city where the experiment is conducted) especially during our recruiting drives. The city experienced extreme tension and violent protests due to some cultural issues about the treatment of cows by certain ethnic groups. In the end the Indian Supreme Court had to decide on the matter and the situation has been calmed down. The monsoon season this year was particularly strong including cyclone Vardah hitting the city. These events led to several disruptions in the city's transportation system and economic activity. In addition, the death of the Tamil Nadu Chief Minister and the subsequent political tension led to turmoil among mob and shutting down of the city for a few days.

These disruptions created severe problems for our recruitment and led to significant attrition. In addition, the attrition was considerably higher for participants who preferred to work from home but were asked to work in the office. We conjecture that it was due to the disruptions in public life. This differential in attrition rate would jeopardize the results of our study.

To resolve the issue, we had to delay several recruitment waves in order to avoid the most troubled times in the city. But halfway through the third wave, we also made changes to salary incentives in order to provide stronger retention bonuses for applicants to encourage them to stay in the job. These incentives and changes have worked well and we have been able to reduce the overall attrition from 60% to almost 5% and differential attrition in certain treatments from as high as 97% to close to 20%.

We have observed the attrition rates drop across all the 4 treatment groups. These 4 treatment groups are DEOs who; preferred home and assigned home (H_H), preferred home and assigned office (H_O), preferred office and assigned home (O_H), and preferred office and assigned office (O_O). Additionally, we track attrition at 3 stages, firstly when selected candidates are told their assigned work location (before the work begins), secondly, post completion of 1st week and finally, post completion of 1st month.

Changing Data Entry Market: We also observed a trend of diminished response to our DE newspaper ads. During our 1st wave, we received on an average 120 candidates per ad and this has gone down to 25-35 per ad in the recent rounds. We talked to a number of DE companies in the city and were told that they experienced similar trends. It seems to be part of a maturing labor market. To counteract the lower response rates, we resorted to posting multiple recurring ads in the newspapers for the latest waves. We also expanded the newspaper and TV resources that we are using. This has led to stretching of recruitment timeline especially wave 3. But this way we were able to attract sufficient qualified applicants. And we believe that this method will allow us to successfully complete the study.
Exploitation Route From a policy perspective, understanding the sources of productivity differences between large and small firms is crucial for evaluating the merits of policies that aim to alter the allocation of workers between these two types of firm. As a salient example, India is currently debating the implementation of a massive and extremely expensive apprenticeship system that would give large firms substantial subsidies for hiring workers and training them on the job. The argument for this policy is built on the idea that working in a large firm provides a direct, causal boost to the productivity of workers going forward. However, if the majority of the productivity gap was indeed due to selection of better workers into large firms, then industrial policies of this type may not have the desired impact.
Sectors Financial Services, and Management Consultancy,Government, Democracy and Justice