Government Contracting and Wage Compliance
50 Pages Posted: 4 Sep 2021 Last revised: 18 Oct 2024
Date Written: December 9, 2022
Abstract
This study investigates the relationship between government contracting and wage compliance in the United States. We find that firms which are awarded government contracts experience a significant improvement in wage compliance i.e. we observe a reduction in wage theft. This relationship is primarily driven by enhancements in contractors’ internal processes, particularly improvements in financial reporting. Cross-sectional analysis suggests that this relation is more pronounced when there is greater scope for government monitoring of its suppliers, and suppliers have less incentives to engage with unethical practices.
Keywords: government procurement, wage theft, employee wellbeing
JEL Classification: G18, G38, G39, J31, J83, M14, M41
Suggested Citation: Suggested Citation
Government Contracting and Wage Compliance
(December 9, 2022). Available at SSRN: https://ssrn.com/abstract=3916088 or http://dx.doi.org/10.2139/ssrn.3916088