How Do Employers Use Compensation History?: Evidence from a Field Experiment

61 Pages Posted: 13 Jan 2020

See all articles by Moshe Barach

Moshe Barach

University of Minnesota - Twin Cities - Carlson School of Management

John J. Horton

New York University (NYU) - Department of Information, Operations, and Management Sciences

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Date Written: January 2020

Abstract

We report the results of a field experiment in which treated employers could not observe the compensation history of their job applicants. Treated employers responded by evaluating more applicants, and evaluating those applicants more intensively. They also responded by changing what kind of workers they evaluated: treated employers evaluated workers with 5% lower past average wages and hired workers with 13% lower past average wages. Conditional upon bargaining, workers hired by treated employers struck better wage bargains for themselves.

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Suggested Citation

Barach, Moshe and Horton, John J., How Do Employers Use Compensation History?: Evidence from a Field Experiment (January 2020). NBER Working Paper No. w26627, Available at SSRN: https://ssrn.com/abstract=3518240

Moshe Barach (Contact Author)

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

John J. Horton

New York University (NYU) - Department of Information, Operations, and Management Sciences ( email )

44 West Fourth Street
New York, NY 10012
United States
6175952437 (Phone)

HOME PAGE: http://john-joseph-horton.com

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