Why the youth are so eager for university education? Evidence from Iran’s labor market

2017 ◽  
Vol 44 (3) ◽  
pp. 362-379
Author(s):  
GholamReza K. Haddad ◽  
Nader Habibi

Purpose The purpose of this paper is to estimate the wage difference between overeducated and adequately educated workers in a sample of semi-skilled and low-skill occupations in Iran’s labor market. The objective is to see if overeducated employees in these occupations enjoy higher wages in comparison to their adequately educated co-workers. Design/methodology/approach The authors use the propensity score matching (PSM) model to estimate the wage difference between overeducated and adequately educated workers in a sample of semi-skilled and low-skill occupations in Iran’s labor market. The PSM method allows the authors to prevent selection bias by comparing each group of overeducated workers with a matched group of adequately educated workers with similar socio-economic characteristics. Findings The results show that in Iran’s labor market, the overeducated workers enjoy a wage premium in the range of 10-25 percent for their excess education when they have to work in semi- or low-skill occupations. While this relative advantage has gradually declined for private sector employees over the period 2001-2013, it has remained stable for public sector jobs. The result is attributable to the fact that salary and benefits for public sector employees are directly linked to education attainment and their work experience. The findings show that the relative wage advantage of overeducation is larger for the younger employees with ten or fewer years of experience who have more education than older workers. Overall these findings offer an explanation for the strong desire of Iranian youth for university education. If a university graduate finds a job that matches her/his specialization she/he will enjoy a higher salary than a high school graduate. If she/he has to accept a semi-skilled or low-skill job for which she/he is overeducated, she/he still enjoys a wage premium over her/his co-workers who are not overeducated. Originality/value The analysis makes three unique contributions: first, the authors use a unique and detailed micro-data for an economy (Iran) in which the public sector dominates the private sector. The authors investigate the hypothesis for private and public sectors separately. Second, the authors divide the sample of workers into market newcomers and experienced workers. The authors analyze the impact of overeducations on each group separately. Third, the authors use the treatment effect of being overeducated on the individual’s monthly wage by the PSM. The advantage of the PSM method is that it eliminates the selection bias in the wage effect of overeducation, whereas the traditional regression-based techniques may result in this type of bias.

2019 ◽  
Vol 12 (2) ◽  
pp. 242-262 ◽  
Author(s):  
Chetan Ghate ◽  
Debojyoti Mazumder

Purpose Governments in both developing and developed economies play an active role in labor markets in the form of providing both formal public sector jobs and employment through public workfare programs. The authors refer to this as employment targeting. The purpose of the paper is to consider different labor market effects of employment targeting in a stylized model of a developing economy. In the context of a simple search and matching friction model, the authors show that the propensity for the public sector to target more employment can increase the unemployment rate in the economy and lead to an increase in the size of the informal sector. Design/methodology/approach The model is an application of a search and matching model of labor market frictions, where agents have heterogeneous abilities. The authors introduce a public sector alongside the private sector in the economy. Wage in the private sector is determined through Nash bargaining, whereas the public sector wage is exogenously fixed. In this setup, the public sector hiring rate influences private sector job creation and hence the overall employment rate of the economy. As an extension, the authors model the informal sector coupled with the other two sectors. This resembles developing economies. Then, the authors check the overall labor market effects of employment targeting through public sector intervention. Findings In the context of a simple search and matching friction model with heterogeneous agents, the authors show that the propensity for the public sector to target more employment can increase the unemployment rate in the economy and lead to an increase in the size of the informal sector. Employment targeting can, therefore, have perverse effects on labor market outcomes. The authors also find that it is possible that the private sector wage falls as a result of an increase in the public sector hiring rate, which leads to more job creation in the private sector. Originality/value What is less understood in the literature is the impact of employment targeting on the size of the informal sector in developing economies. The authors fill this gap and show that public sector intervention can have perverse effects on overall job creation and the size of the informal sector. Moreover, a decrease in the private sector wage due to a rise in public sector hiring reverses the consensus findings in the search and matching literature which show that an increase in public sector employment disincentivizes private sector vacancy postings.


2015 ◽  
pp. 62-85 ◽  
Author(s):  
T. Zhuravleva

This paper surveys the literature on public-private sector wage differentials for Russian labor market. We give an overview of the main results and problems of the existing research. The authors unanimously confirm that in Russia private sector workers receive higher wages relative to their public sector counterparts. According to different estimates the "premium" varies between 7 and 40%. A correct evaluation of this "premium" is subject to debate and is a particular case of a more general econometric problem of wage differentials estimation. The main difficulties are related to data limitations, self-selection and omitted variables. Reasons for the existence of a stable private sector "premium" in Russia are not fully investigated.


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Moumita Acharyya ◽  
Tanuja Agarwala

PurposeThe paper aims to understand the different motivations / reasons for engaging in CSR initiatives by the organizations. In addition, the study also examines the relationship between CSR motivations and corporate social performance (CSP).Design/methodology/approachThe data were collected from two power sector organizations: one was a private sector firm and the other was a public sector firm. A comparative analysis of the variables with respect to private and public sector organizations was conducted. A questionnaire survey was administered among 370 employees working in the power sector, with 199 executives from public sector and 171 from private sector.Findings“Philanthropic” motivation emerged as the most dominant CSR motivation among both the public and private sector firms. The private sector firm was found to be significantly higher with respect to “philanthropic”, “enlightened self-interest” and “normative” CSR motivations when compared with the public sector firms. Findings suggest that public and private sector firms differed significantly on four CSR motivations, namely, “philanthropic”, “enlightened self-interest”, “normative” and “coercive”. The CSP score was significantly different among the two power sector firms of public and private sectors. The private sector firm had a higher CSP level than the public sector undertaking.Research limitations/implicationsFurther studies in the domain need to address differences in CSR motivations and CSP across other sectors to understand the role of industry characteristics in influencing social development targets of organizations. Research also needs to focus on demonstrating the relationship between CSP and financial performance of the firms. Further, the HR outcomes of CSR initiatives and measurement of CSP indicators, such as attracting and retaining talent, employee commitment and organizational climate factors, need to be assessed.Originality/valueThe social issues are now directly linked with the business model to ensure consistency and community development. The results reveal a need for “enlightened self-interest” which is the second dominant CSR motivation among the organizations. The study makes a novel contribution by determining that competitive and coercive motivations are not functional as part of organizational CSR strategy. CSR can never be forced as the very idea is to do social good. Eventually, the CSR approach demands a commitment from within. The organizations need to emphasize more voluntary engagement of employees and go beyond statutory requirements for realizing the true CSR benefits.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohamed Z. Elbashir ◽  
Steve G. Sutton ◽  
Vicky Arnold ◽  
Philip A. Collier

Purpose Recent research and policy reports indicate public sector organizations struggle to leverage information technology-based performance measurement systems and fail to effectively evaluate performance beyond financial metrics. This study aims to focus on organizational factors that influence the assimilation of business intelligence (BI) systems into integrated management control systems and the corollary impact on improving business process performance within public sector organizations. Design/methodology/approach The complete Australian client list was acquired from a leading BI vendor; and the authors surveyed all public sector organizations, receiving 226 individual responses representing 160 public sector organizations in Australia. Using latent construct measurement, structural equation modeling (SEM)-partial least squares is used to test the theoretical model. Findings When top management promotes knowledge creation among the organization’s operational level employees and support their activities with strong BI infrastructure, the same knowledge and infrastructure capabilities that are critical to assimilation in private sector hold in the public sector. However, public sector organizations generally have difficulty retaining staff with expertise in new technologies and attracting new innovative staff that can leverage smart systems to effect major change in performance measurement. When top management effectively manages knowledge importation from external entities to counteract deficiencies, public sector organizations effectively assimilate BI knowledge into performance measurement yielding strong process performance. Research limitations/implications When top management promotes knowledge creation among the organization’s operational level employees and support their activities with strong BI infrastructure, the same knowledge and infrastructure capabilities critical to assimilation in the private sector hold in the public sector. However, public sector organizations generally have difficulty retaining staff with expertise in new technologies and attracting new innovative staff that can leverage smart systems to effect major change in performance measurement. The research extends the theory behind organizational absorptive capacity by highlighting how knowledge importation can be used as an external source facilitating internal knowledge creation. This collaborative knowledge creation leads to affective assimilation of BI technologies and associated performance gains. Practical implications The results provide guidance to public sector organizations that struggle to measure and validate service outcomes under New Public Management regulations and mandates. Originality/value The results reveal that consistent with the philosophies behind New Public Management strategies, private sector measures for increasing organizational absorptive capacity can be applied in the public sector. However, knowledge importation appears to be a major catalyst in the public sector where the resources to retain skilled professionals with an ability to leverage contemporary technologies into service performance are often very limited. Top management team knowledge and skills are critical to effectively leveraging these internal and external knowledge creation mechanisms.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  

Purpose The authors assumed PSM would be higher in the public sector, but they set up a trial to find out if this was the case. Design/methodology/approach To test their theories, the authors conducted two independent surveys. The first consisted of 220 usable responses from public sector employees in Changsha, China. The second survey involved 260 usable responses from private sector employees taking an MBA course at a university in the Changsha district. A questionnaire was used to assess attitudes. Findings The results found no significant difference between the impact of public sector motivation (PSM) on employee performance across the public and private sectors. The data showed that PSM had a significant impact on self-reported employee performance, but the relationship did not differ much between sectors. Meanwhile, it was in the private sector that PSM had the greatest impact on intention to leave. Originality/value The authors said the research project was one of the first to test if the concept of PSM operated in the same way across sectors. It also contributed, they said, to the ongoing debate about PSM in China.


2015 ◽  
Vol 8 (3) ◽  
pp. 408-440 ◽  
Author(s):  
Sulafa M. Badi ◽  
Stephen D Pryke

Purpose – The purpose of this paper is to examine the quality of collaboration towards Sustainable Energy Innovation (SEI) in Private Finance Initiative (PFI) projects. While the capacity of PFI to encourage collaboration towards innovation is largely advocated by its proponents; however, it remains to be supported by empirical evidence. Design/methodology/approach – Adopting the Complex Product System (CoPS) innovation management model, the authors assess the quality of collaboration at the interface between the innovation superstructure of public sector clients and users, and the innovation infrastructure of private sector designers, contractors and operators. Two interactional elements are examined upon which the quality of collaboration is assessed: openness of communication and alignment of objectives. The authors apply the model to four new-built PFI school projects within the context of the UK government Building Schools for the Future Programme. Semi-structured interviews with total of 50 key stakeholders were used as the primary data collection method. Findings – PFI has introduced a number of problematic issues weakening collaborative efforts towards innovation in the project environment. Particularly, the study underlines the restricting internal contractual relationships within the integrated Project Company and the misalignment of Design-Construction-Operation sustainability objectives. It also highlights ineffective communication with public sector clients and users brought in by the restricted nature of PFI engagement processes as well as the misalignment of public sector-private sector sustainability objectives. Research limitations/implications – The qualitative nature of the chosen research methodology limits the ability to generalise. The research findings need to be confirmed or rejected by means of quantitative research as representative of all PFI projects. Practical implications – The study emphasizes the public authority’s role in relation to providing the necessary conditions for the creation of a collaborative environment conducive to SEI in PFI projects. Originality/value – The study was able to expand the understanding of innovation and collaboration management processes in PFI projects in three respects: First, addressing the limited attention to innovation in PFI research, the study is the first to examine the quality of collaboration in PFI projects towards the implementation SEI. Second, examining the quality of collaboration in PFI projects through the lens of CoPS provides a new understanding of sustainability innovation and strongly indicates that the CoPS model should be expanded to account for the dynamics of innovation processes in the procurement of sustainable CoPS. Third, the explorative nature of the study was useful in generating research hypotheses that can form the basis for future research on SEI in PFI projects.


2019 ◽  
Vol 35 (3) ◽  
pp. 345-358
Author(s):  
Chew Har Loke ◽  
Suhaiza Ismail ◽  
A.H. Fatima

Purpose The purpose of this paper is to empirically test Arnaud’s (2010) ethical climate index (ECI) of measuring ethical work climate (EWC) in the context of Malaysian public sector auditors (PSAs). Design/methodology/approach EWC is conceptualized as four main components with two sub-components. Questionnaires were distributed to the population of PSAs in the Malaysian National Audit Department (NAD). Factor analysis (principal component analysis [PCA]) was used to verify the components of EWC. Findings Results from PCA revealed that EWC, indeed, has four main components. Therefore, the findings of this study provide empirical evidence that validates Arnaud’s (2010) EWC model, although tested on PSAs in Malaysia. Research limitations/implications This paper has a limited purpose, which is to test whether the ECI could be applied to PSAs in Malaysia to derive the original four main components of Arnaud’s EWC. Thus, this study does not evaluate the EWC of PSAs or determine causal relationships between EWC and other variables; these are left to future studies. Practical implications The findings of this study confirm that Arnaud’s (2010) ECI is sufficiently resilient to be applied to the context of PSAs in Malaysia. Hence, future studies could use this index to measure EWC not only in the public sector but also in the private sector. Future research could also further test this index in different contexts. Originality/value Arnaud’s (2010) ECI was originally applied in the context of the private sector in a developed country. Hence, this study adds value by extending the ECI to the public sector in a developing country, Malaysia.


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Merve Kılıç ◽  
Ali Uyar ◽  
Cemil Kuzey ◽  
Abdullah S. Karaman

PurposeThe objective of this study is to investigate whether the institutional environment is associated with the adoption of integrated reporting.Design/methodology/approachThe sample of the study is based on the firms included in the list of Fortune Global 500. The logistic regression analysis was run to test the proposed hypotheses.FindingsThe findings indicated that the code-law orientation and strength of the institutional quality are significantly associated (i.e. positively and negatively, respectively) with the integrated reporting of Fortune 500 companies. Firms are motivated for more transparency in stakeholder-oriented and weakly regulated contexts. Thus, stakeholder pressure is more influential than shareholder interest in motivating or forcing firms to issue integrated reports. Besides, there appears to be a trade-off between the public sector and the private sector in terms of ensuring an accountable and transparent business environment. If the public sector does not undertake its role in ensuring a transparent business environment, the private sector fills the gap. The results are robust to alternative sampling and methodologies.Research limitations/implicationsThis study implied that the stakeholder orientation of countries fosters the transparency and accountability of firms. Corporate behavior is impacted by the institutional strength or weakness of nations. The institutional theory provides an appropriate ground to understand drivers of corporate reporting practices of firms beyond firm-level characteristics.Practical implicationsThe adoption of integrated reporting framework by Fortune 500 companies can be leveraged to alleviate concerns about their social and environmental impacts. Policy-makers in the countries which have a weak institutional environment force or encourage their firms to increasingly meet the transparency and accountability demands of society.Social implicationsThe research findings might play an encouraging role in that various stakeholders (i.e. customers, public, civil organizations and press) should undertake active roles and responsibilities to encourage firms to behave in socially and environmentally responsible ways.Originality/valueThis study adds to the literature by examining the influence of the institutional environment on the adoption of integrated reporting, using recent international data, and focusing on the largest companies according to the Fortune's annual Global 500 list. This study is one of the first to examine the association between a set of governance characteristics (i.e. board size, board independence and board diversity) and integrated reporting adoption.


2015 ◽  
Vol 34 (6) ◽  
pp. 634-652 ◽  
Author(s):  
Neetu Jain ◽  
Prachi Bhatt

Purpose – In the ever increasing competition in the employment market, an organization’s need to become a “great place to work” has gained significant momentum. Employer branding has thus emerged as an essential management practice employed by the organization to create its image as desirable employer in the eyes of prospective employees. The purpose of this paper is to highlight the understanding of employer branding through the eyes of “potential” young employees in Delhi and North Central Region, India. The results presented in this paper throw light on the perceived importance of employer branding among the prospective employees via analysis of various branding factors chosen for the study. The study results report that the perceived significance of employer branding factors differs mainly across gender and age of prospective employees. Notably, public and private sectors are being perceived significantly different by the potential job applicants on employer branding factors. Thus, this paper presents important findings enabling employers to build brand value and an attractive reputation in the job market so as to attract and retain the best talent. Design/methodology/approach – Survey methodology was used to test the hypothesis. The sample was selected from Delhi and National Capital Region (NCR) primarily from the students of business schools who were randomly selected to fill in the questionnaire. As they are the potential hires, it seemed appropriate to know their preference of employer branding factors. They are ready to join the corporations therefore, data extracted would be much more suitable as they can throw light on their immediate preferences and provide insight into the research study. For collection of data an online structured questionnaire was administered. A total of 270 questionnaires were administered and 239 filled questionnaires were received. Findings – From the results it can be seen that private sector emerged as preferred sector of choice for the majority of potential employees. However, there are some factors which are handled well in private sector as compared to public sector and vice versa. There are some factors like – stability of the company, work-life balance and job security which potential employees perceive as important and therefore, need to be addressed by both public and private sector organizations. Research limitations/implications – Limitation of this study is that the findings cannot be generalized therefore, provide opportunities for further research. Moreover, the sample included only students as prospective employees seeking a new job or a career change. Thus the results obtained on a sample of relatively inexperienced job seekers, might partially reflect commonly held stereotypes of attractive organizations. Hence, it is interesting to use other samples such as experienced job seekers or those who are currently employed. Another limitation is that the study is restricted to Delhi and NCR region hence, the data is not representative of a wider population. Further research may expand the scope in terms of sample size as well. Future research may also explore the extent of employee attraction and retention vis-à-vis employer branding factors in organizations. A final avenue for future studies consists in exploring the processes which underlie the organizational choice decisions of prospective applicants. Practical implications – This study has added to the growing body of research on employer branding factors by generating more knowledge and arguments in favor of certain employer branding factors in the workplace. If organizations truly want to attract good talented people then management needs to bring about the necessary organizational support and infrastructure at the early and middle stages of an employee’s career which are most often the stages where important choices are made. They need to be more considerate toward employee needs. Efforts can be made to build a good work culture by paying heed to their preferences. Therefore, this study helps establish a foundation for implementation of various employer branding factors which are perceived important by the potential job applicants, especially in Indian context. The findings are of particular important for human resource (HR) managers and policy makers in both public sector as well as private sectors in these times of increased inter-sectoral personnel movement. These findings can be utilized as a guiding instrument while inter-sectoral recruitment is being made. These would also enable employers to take appropriate action in order to build their employer brand based on certain discussed employer branding factors so as to attract talent which in turn would also help them in retaining talent. Social implications – There are many employer branding factors which tend to affect the mindset of potential employees in selecting their prospective employer. Employers can therefore, endeavor to understand those factors at length so as to attract talent which in turn would also help in retaining talent. Originality/value – Results throw light on the perceived importance the potential employees give to various employer branding factors taken for the study. Perceived significance attached to employer branding factors differs across gender, age, education background, etc. It was also found that for some important employer branding factors public and private sectors are being perceived significantly different by the potential job applicants. Thus, paper presents important findings that would enable employers to take actions in order to build their employer brand so as to attract talent which in turn would also help them in retaining talent.


2016 ◽  
Vol 5 (4) ◽  
pp. 371-387 ◽  
Author(s):  
Sean D. Darling ◽  
J. Barton Cunningham

Purpose The purpose of this paper is to identify unique values and competencies linked to private and public sector environments. Design/methodology/approach This study is based on critical incident interviews with a sample of senior leaders who had experience in both the public and private sectors. Findings The findings illustrate distinct public and private sector relevant competencies that reflect the unique values of their organizations and the character of the organization’s environments. This paper suggests a range of distinct public sector competencies including: managing competing interests, managing the political environment, communicating in a political environment, interpersonal motivational skills, adding value for clients, and impact assessment in decision-making. These were very different than those identified as critical for the private sector environment: business acumen, visionary leadership, marketing communication, market acumen, interpersonal communication, client service, and timely and opportunistic decision-making. Private sector competencies reflect private sector environments where goals need to be specifically defined and implemented in a timely manner related to making a profit and surviving in a competitive environment. Public sector competencies are driven by environments exhibiting more complex and unresolvable problems and the need to respond to conflicting publics and serving the public good while surviving in a political environment. Originality/value A key message of this study is that competency frameworks need to be connected to the organization’s unique environments and the values that managers are seeking to achieve. This is particularly important for public organizations that have more complex and changing environments.


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