Would workers apply to better firms if they were more informed about firm quality? Collaborating with 26 science-based start-ups, we create a custom job board and invite business school alumni to apply. The job board randomizes across applicants to show coarse expert ratings of all start-ups' science and/or business model quality. Making ratings visible strongly reallocates applications toward higher-rated firms. This reallocation holds, restricting to high-quality workers. Treatments operate in part by shifting worker beliefs about firms' right-tail outcomes. Despite these benefits, workers make posttreatment bets indicating highly overoptimistic beliefs about start-up success, suggesting a problem of broader informational deficits. (JEL D22, D83, J22, J23, J24, M13, M51)

In a large German bakery chain, many workers report negative perceptions of monitoring via checklists. We survey workers and managers about the value and time costs to all in-store checklists, leading the firm to randomly remove two of the most perceivedly time-consuming and low-value checklists in half of stores. Sales increase and store manager attrition substantially decreases, and this occurs without a rise in measurable workplace problems. Before random assignment, regional managers predict whether the treatment would be effective for each store they oversee. Ex post, beneficial effects of checklist removal are fully concentrated in stores where regional managers predict the treatment will be effective, reflecting substantial heterogeneity in returns that is well-understood by these upper managers. Effects of checklist removal do not appear to come from workers having more time for production, but rather coincide with improvements in employee trust and commitment. Following the RCT, the firm implemented firmwide reductions in monitoring, eliminating a checklist regarded as demeaning, but keeping a checklist that helps coordinate production. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

How do firms adjust wages and non-wage policies over time to fill their jobs? Using administrative data and two RCTs on a large staffing platform, we show that even when jobs are unfilled days or hours before the start of work, most firms do not raise wages. Rather, firms are much more likely to make non-wage adjustments such as lowering skill requirements. When wage adjustment occurs, it is usually in the positive direction and occurs close to when work begins. Firms’ reluctance to raise wages does not appear to be due to inattention or time constraints. Firms reject opportunities to use different forms of automatic wage adjustments presented by the platform in the first RCT. Instead, firms are uncertain about the labor supply elasticity and concerned about spillovers from raising wages, both across workers and over time.A second worker-side RCT that randomly adjusts wages confirms wage increases are effective at increasing completed work, allowing us to quantify the production ramifications of firm search frictions. Our results help rationalize why many vacancies go unfilled.

In a large German bakery chain, many workers report negative perceptions of monitoring via checklists. We survey workers and managers about the value and time costs to all in-store checklists, leading the firm to randomly remove two of the most perceivedly time-consuming and low-value checklists in half of stores. Sales increase by 2-3% and store manager attrition substantially decreases. Mystery shopping indicates this occurs without a rise in workplace problems. Before random assignment, regional managers predict whether the treatment would be effective for each of the stores that they oversee. Ex post, beneficial effects of checklist removal are fully concentrated in stores where regional managers predict that the treatment will be effective, reflecting substantial heterogeneity in returns that is well-understood by these upper managers. Effects of checklist removal do not appear to come from workers having more time for production, but rather due to improvements in employee trust and commitment. Following the RCT, the firm implemented firmwide reductions in monitoring, eliminating a checklist that employees regard as demeaning, but keeping a checklist that helps coordinate production.

Employee referral programs (ERPs) are randomly introduced in a grocery chain. On direct effects, larger referral bonuses increase referral quantity but decrease quality, though the increase in referrals from ERPs is modest. However, the overall effect of having an ERP is substantial, reducing attrition by 15% and significantly decreasing labor costs. This occurs, partly, because referrals stay longer than nonreferrals, but, mainly, from indirect effects: nonreferrals stay longer in treated than in control stores. The most supported mechanism for these indirect effects is workers value being involved in hiring. Attrition impacts are larger in higher performing stores and better local labor markets.

Would workers apply to better firms if they were more informed about firm quality? Collaborating with 26 science-based startups, we create a custom job board and invite business school alumni to apply. The job board randomizes across applicants to show coarse expert ratings of all startups' science and/or business model quality. Making this information visible strongly reallocates applications toward better firms. This reallocation holds even when restricting to high-quality workers. The treatments operate in part by shifting worker beliefs about firms' right-tail outcomes. Despite these benefits, workers make post-treatment bets indicating highly overoptimistic beliefs about startup success, suggesting a problem of broader informational deficits.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

We experimentally test several approaches to increasing the demand for workers with a criminal record on a nationwide staffing platform by addressing potential downside risk and productivity concerns. The staffing platform asked hiring managers to make a series of hypothetical hiring decisions that affected whether workers with a criminal record could accept their jobs in the future. We find that 39% of businesses in our sample are willing to work with individuals with a criminal record at baseline, which rises to over 50% when businesses are offered crime and safety insurance, a single performance review, or a limited background check covering just the past year. Wage subsidies can achieve similar increases but at a substantially higher cost. Based on our findings, the staffing platform relaxed the criminal background check requirement and offered crime and safety insurance to interested businesses.

In an RCT with US small businesses, we document that a large share of firms are not well-informed about bankruptcy. Many assume that bankruptcy necessarily entails the death of a business and do not know about Chapter 11, where debts are renegotiated so that the business can continue operating. Firms also exhibit bankruptcy-related stigma, believing that bankruptcy is embarrassing, a sign of failure, and a negative signal to employees and customers. Short educational videos that address information or stigma increase knowledge and decrease stigma, both immediately and durably over 4 months. Videos increase reported interest in using Chapter 11 bankruptcy and increase intended debt and investment. However, we do not observe long-term real effects. A survey of bankruptcy attorneys and judges points to entrepreneurs’ overconfidence and, to a lesser extent, excessive perceived legal fees as first-order frictions explaining the limited real impact of treatments that only address information and stigma.

How much do a manager's interpersonal skills with subordinates, which we call people management skills, affect employee outcomes? Are managers rewarded for having such skills? Using personnel data from a large high-tech firm, we show that survey-measured people management skills have a strong negative relation to employee turnover. A causal interpretation is reinforced by several research designs, including those exploiting new workers joining the firm and workers switching managers. However, people management skills do not consistently improve most observed nonattrition outcomes. Better people managers themselves receive higher subjective performance ratings, higher promotion rates, and larger salary increases.

During the 2010 gubernatorial elections, we elicit voter beliefs about the closeness of the election before and after showing different polls, which, depending on treatment, indicate a close or not-close race. Subjects update their beliefs in response to polls, but overestimate the probability of a very close election. However, turnout is unaffected by beliefs about election closeness. A follow-up RCT, conducted during the 2014 gubernatorial elections at much larger scale, also points to little relationship between poll information about closeness and turnout. We caveat that the strength of our evidence depends on assumptions regarding our treatments’ impacts on beliefs. (JEL C93, D72)

Paying higher salaries is often believed to enhance worker effort, leading workers to work harder to avoid getting fired.However, workers may also respond to higher salaries by focusing on tasks that most directly affect getting fired (as opposed to those that contribute most to productivity).We explore these issues by analyzing the relationship between the level of compensation and time use for US state legislators.Using data on time use and legislator salaries, we show that higher salary is associated with legislators spending more time on fundraising.In contrast, higher salary is also associated with less time spent on legislative activities and has no clear relation to time spent on constituent services.Subgroup analysis broadly supports our interpretation of the data.

We received helpful comments from numerous people and seminar audiences, especially Tore Ellingsen, Matt Gentzkow, Rosario Macera, Kathryn Shaw, Lowell Taylor, and Russell Weinstein. We thank the study firm’s management and employees for their collaboration. We thank Muhammad Azim, Daphne Baldassari, Julija Mozurevičiute, Monika Mozurevičiute, and Sonja Settele for excellent research assistance. We are grateful to the World Management Survey (WMS) and especially Daniela Scur for sharing their data with us, which we use to report on the prevalence of employee referral programs. Financial support from the Institutional Strategy of the University of Cologne within the German Excellence Initiative (Hans Kelsen Prize 2018), Michael Lee-Chin Family Institute, and SSHRC is gratefully acknowledged. The experiment was pre-registered on 11/23/2015 with the AEA RCT registry under ID AEARCTR-0000964. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

Combining weekly productivity data with weekly productivity beliefs for a large sample of truckers over 2 years, we show that workers tend to systematically and persistently overpredict their productivity. If workers are overconfident about their own productivity at the current firm relative to their outside option, they should be less likely to quit. Empirically, all else equal, having higher productivity beliefs is associated with an employee being less likely to quit. To study the implications of overconfidence for worker welfare and firm profits, we estimate a structural learning model with biased beliefs that accounts for many key features of the data. While worker overconfidence moderately decreases worker welfare, it also substantially increases firm profits.

Employee referral programs (ERPs) are randomly introduced in a grocery chain. Larger referral bonuses increase referrals and decrease referral quality, though the increase in referrals from having an ERP is modest. However, the overall effect of having an ERP is substantial, reducing attrition by roughly 15% and decreasing firm labor costs by up to almost 3%. This occurs, partly, because referrals stay longer than nonreferrals, but, mainly, because all workers stay longer in treated than control stores, even among stores where no referrals are made. The most-supported mechanism for these indirect effects is that workers value being involved in hiring.