Creating a Bigger Pie? the Effects of Employee Ownership, Profit Sharing, and Stock Options on Workplace Performance

43 Pages Posted: 18 Aug 2008 Last revised: 4 Aug 2010

See all articles by Joseph Blasi

Joseph Blasi

Rutgers School of Management and Labor Relations - New Brunswick

Richard B. Freeman

National Bureau of Economic Research (NBER); University of Edinburgh - School of Social and Political Studies; Harvard University; London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP)

Chris Mackin

Ownership Associates, Inc.

Douglas L. Kruse

Rutgers University

Date Written: August 2008

Abstract

This paper uses data from NBER surveys of over 40,000 employees in hundreds of facilities in 14 firms and from employees on the 2002 and 2006 General Social Surveys to explore how shared compensation affects turnover, absenteeism, loyalty, worker effort, and other outcomes affecting workplace performance. The empirical analysis shows that shared capitalism has beneficial effects on all outcomes save for absenteeism and that it has its strongest effects on turnover, loyalty, and worker effort when it is combined with: a) high-performance work policies (employee involvement, training, and job security), b) low levels of supervision, and c) fixed wages that are at or above market level. Most workers report that cash incentives, stock options, ESOP stock, and ESPP participation motivate them to work harder. The interaction of the effects of shared capitalism with other corporate policies suggests that the various shared capitalist and other policies may operate through a latent variable, "corporate culture".

Suggested Citation

Blasi, Joseph R. and Freeman, Richard B. and Mackin, Chris and Kruse, Douglas L., Creating a Bigger Pie? the Effects of Employee Ownership, Profit Sharing, and Stock Options on Workplace Performance (August 2008). NBER Working Paper No. w14230. Available at SSRN: https://ssrn.com/abstract=1231685

Joseph R. Blasi

Rutgers School of Management and Labor Relations - New Brunswick ( email )

Piscataway, NJ 08854
United States
732-445-5444 (Phone)
732-445-2830 (Fax)

Richard B. Freeman (Contact Author)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
617-868-3900 (Phone)
617-868-2742 (Fax)

University of Edinburgh - School of Social and Political Studies ( email )

Adam Ferguson Building
George Square
Edinburgh EH8 9LL
United Kingdom

Harvard University ( email )

Littauer Center
Cambridge, MA 02138
United States
617-868-3900 (Phone)

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE

Chris Mackin

Ownership Associates, Inc. ( email )

122 Mt. Auburn Street
Cambridge, MA 02138
United States

Douglas L. Kruse

Rutgers University ( email )

Piscataway, NJ 08854
United States
908-445-5991 (Phone)
908-445-2830 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
124
Abstract Views
1,260
rank
224,652
PlumX Metrics