Recent Award

Doctoral Dissertation Research in Economics: Do Identity Concerns Affect Labor Supply?

A sense of identity can be a powerful influence over behavior, including work. Workers who identify themselves as belonging to one group may regard a job associated with a different group as a violation of their identity, especially if the job is associated with a group perceived to have lower social status. This identity channel may partly explain why some groups are over- or under-represented in some occupations. The identity-related mis-representation of groups in occupations leads to a misallocation of talent and cause economic inefficiency. The effect of identity on labor supply, however, has been difficult to establish by researchers for a variety of reasons. This study will use experimental methods to study how identity concerns affect labor supply. The study provides the first experimental test of identity effect on labor supply and distinguishes the effect of intrinsic motivations (e.g. self-image) from extrinsic motivations (e.g. fear of social sanctions). Understanding these identity effects would inform discussions on why occupational choice is not evenly distributed across groups of people with potentially important policy implications. The results of this study will provide major inputs into policies to increase the efficiency of labor markets, improve job matches and increase economic growth.

This project examines how identity concerns affect job-specific labor supply using a field experiment. Casual laborers interested in a one-day job opportunity are presented with a large set of potential job offers and asked to choose whether to accept or decline each offer, one of which is randomly implemented. While all offers involve a default manufacturing task, job seekers are also required to spend some time privately on an additional task, which changes across offers. Using separately-collected survey information on the social associations of the tasks and the perceived hierarchy of local social groups, predictions are made of which worker-offer combinations would involve identity concerns. This design allows researchers to quantify the reduction in the job take-up rate that is attributable to the predicted presence of identity concerns. In addition, by randomly varying whether workers expect their job take-up decisions to be publicized to their neighbors or not, one can distinguish the effects of intrinsic and extrinsic motivations. The results of this research will improve the functioning of labor markets, hence economic growth.

Principal Investigator: 

Eric Verhoogen

Professor of Economics and International and Public Affairs

Home Department: 

Date: 

Sunday, September 1, 2019 to Sunday, August 30, 2020

Research Category: 

Amount: 

$28,000

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