Does High Involvement Management Lead to Higher Pay?

NIESR Discussion Paper No. 376

37 Pages Posted: 2 Feb 2011

See all articles by Petri Bockerman

Petri Bockerman

Labour Institute for Economic Research; University of Turku - Turku School of Economics

Alex Bryson

UCL ; National Institute of Economic and Social Research (NIESR)

Pekka Ilmakunnas

Aalto University School of Business

Date Written: February 1, 2011

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.

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

JEL Classification: J24, J31, J33, M12, M50, M52, M53, M54

Suggested Citation

Bockerman, Petri and Bryson, Alex and Ilmakunnas, Pekka, Does High Involvement Management Lead to Higher Pay? (February 1, 2011). NIESR Discussion Paper No. 376, Available at SSRN: https://ssrn.com/abstract=1752826 or http://dx.doi.org/10.2139/ssrn.1752826

Petri Bockerman (Contact Author)

Labour Institute for Economic Research ( email )

FIN-00530 Helsinki
Finland
+358 9 2535 7332 (Phone)
+358 9 2535 7332 (Fax)

HOME PAGE: http://www.petribockerman.fi/

University of Turku - Turku School of Economics ( email )

Rehtorinpellonkatu 3
TURKU, FI-20500
Finland

Alex Bryson

UCL ( email )

20 Bedford Way
London, WC1H 0AL
United Kingdom

HOME PAGE: http://https://iris.ucl.ac.uk/iris/browse/profile?upi=ABRYS65

National Institute of Economic and Social Research (NIESR) ( email )

2 Dean Trench Street
Smith Square
London, SW1P 3HE
United Kingdom

HOME PAGE: http://www.niesr.ac.uk/staff/staffdetail.php?StaffID=307

Pekka Ilmakunnas

Aalto University School of Business ( email )

PO Box 21240
FI-00076 Aalto, Helsinki
Finland
+358 40 5815390 (Phone)

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