Job assignments and the ability level of workers in business firm

• Project/Area Number: 13630153
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Single-year Grants
• Section: 一般
• Research Field: Business administration
• Research Institution: Waseda University
• Principal Investigator: INOUE Tadashi School of Social Sciences, Professor, 社会科学部, 教授 (70151610)
• Project Period (FY): 2001 – 2002
• Project Status: Completed (Fiscal Year 2002)
• Budget Amount: ¥1,000,000 (Direct Cost: ¥1,000,000); Fiscal Year 2002: ¥500,000 (Direct Cost: ¥500,000); Fiscal Year 2001: ¥500,000 (Direct Cost: ¥500,000)
• Keywords: Job assignment / Information asymmetry / Overlapping generation model / Firm specific human capital

Research Abstract

When a firm is going to employ a new worker who has been already employed in other firm, the employer is disadvantageous about the information of the worker's ability. In order to overcome this disadvantageous situation, the employer can use the present "job assignment" of the worker as a signal of his/her ability. The asymmetry of the information about the ability level of the worker between the information owned by the firm in which worker has been already worked and the information owned by the firm which is going to employ the worker can be mitigated by observing present job assignments.
Under such a situation, the following three results are clarified by this research. To begin with, wage rate tends to relate to the jobs rather than the ability level. Second, job assignments of the employee should tend to be inefficient. Third, this inefficiency tends to negatively correlate with the level of "firm specific human capitals". In order to analyze these issues, the research analyzes them using "overlapping-generations model."