Arbeitspapier
Outside options and worker motivation
We study the relationship between outside options and workers’ motivation to exert effort. We evaluate changes in outside options arising from age and experience cutoffs in the Austrian unemployment insurance (UI) system, and use absenteeism as a proxy for worker effort. Results indicate that a one-percent increase in the potential UI benefit duration increases absenteeism at the intensive margin by 0.28 percent. These results are consistent with a relational contracting model where effort is constrained by the future value of an employment relationship. This model further predicts that effort reductions are more pronounced if benefits assume a larger role in a worker’s outside option and if the perceived relationship value is small. Indeed, we find that our effects are stronger for workers with higher potential cost of unemployment, for older workers, in declining rather than in growing firms, in low-wage firms, and for women as well as workers with children.
- Language
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Englisch
- Bibliographic citation
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Series: Working Paper ; No. 2308
- Classification
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Wirtschaft
- Event
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Geistige Schöpfung
- (who)
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Ahammer, Alexander
Fahn, Matthias
Stiftinger, Flora
- Event
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Veröffentlichung
- (who)
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Johannes Kepler University of Linz, Department of Economics
- (where)
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Linz
- (when)
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2023
- Handle
- Last update
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10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Ahammer, Alexander
- Fahn, Matthias
- Stiftinger, Flora
- Johannes Kepler University of Linz, Department of Economics
Time of origin
- 2023
Other Objects (12)
Outside Options and Worker Motivation
Outside Options and Worker Motivation
Worker Beliefs about Outside Options
Worker beliefs about outside options
Worker Beliefs about Outside Options
Bargaining, search, and outside options
Outside Options in Probabilistic Coalition Situations
Contracting with Externalities and Outside Options
A Model of Electoral Competition with Outside Options
Bargaining power and outside options in the interbank lending market bargaining power and outside options in the interbank lending market
Technology spillovers and outside options in a bilateral duopoly
Bargaining power and outside options in the interbank lending market
Outside Options and Worker Motivation
Outside Options and Worker Motivation
Worker Beliefs about Outside Options
Worker beliefs about outside options
Worker Beliefs about Outside Options
Bargaining, search, and outside options
Outside Options in Probabilistic Coalition Situations
Contracting with Externalities and Outside Options
A Model of Electoral Competition with Outside Options
Bargaining power and outside options in the interbank lending market bargaining power and outside options in the interbank lending market
Technology spillovers and outside options in a bilateral duopoly
Bargaining power and outside options in the interbank lending market
Outside Options and Worker Motivation
Outside Options and Worker Motivation
Worker Beliefs about Outside Options
Worker beliefs about outside options
Worker Beliefs about Outside Options
Bargaining, search, and outside options
Outside Options in Probabilistic Coalition Situations
Contracting with Externalities and Outside Options
A Model of Electoral Competition with Outside Options
Bargaining power and outside options in the interbank lending market bargaining power and outside options in the interbank lending market
Technology spillovers and outside options in a bilateral duopoly