The Effect of Creaming on Placement Rates Under the Job Training Partnership Act

Anderson, Kathryn H.; Burkhauser, Richard V.; Raymond, Jennie E.

doi:10.2307/2524307

Cited by 42 publications

(37 citation statements)

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“…Unfortunately, not all jobs are as narrowly defined and easily mon-itored as windshield installation; more typically, organizations get what they pay for. For two recent examples based on large micro datasets rather than the case studies above, see Brown, Harlow and Starks (1996) and Chevalier and Ellison (1997) on how the convex relationship between fund performance and assets under management caused risk-taking portfolio choices by ostensibly conservative mutual funds, and Anderson, Burkhauser and Raymond (1993) and Cragg (1997) on how the Job Training Partnership Act rewarded training providers for re-employment outcomes rather than for value added, so providers chose participants who were likely to find jobs even without training.…”

Section: Objective Performance Measurementmentioning

confidence: 99%

Incentives in Organizations

Gibbons

1998

Journal of Economic Perspectives

688

176

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In 1975, Steven Kerr published ''On the Folly of Rewarding A, While Hoping for B.'' The argument was simple: you get what you pay for. Kerr distilled this unifying theme from a disparate set of examples involving politicians, soldiers, doctors, orphanage directors, professors, and students, as well as manufacturing and clerical employees and even human-resource managers. From these examples, concluded that two main causes of distorted incentives are ''fascination with an 'objective' criterion, [where] individuals seek to establish simple, quantifiable standards against which to measure and reward performance'' and ''overemphasis on highly visible behaviors, [when] some parts of the task are highly visible while others are not.'' It took agency theory 15 years to express Kerr's title, not to mention to evaluate or extend his conclusions. During this period, agency theory was obsessed with the tradeoff between incentives and insurance, even though clear-eyed observations like Kerr's about the design and performance of real incentive contracts suggested that several other issues are at least as important. Fortunately, recent work has brought agency theory not only to Kerr's position but beyond.In this paper I summarize four new strands in agency theory that help me think about incentives in real organizations. As a point of departure, I begin with a quick sketch of the classic agency model. I then discuss static models of objective performance measurement that sharpen Kerr's argument; repeated-game models of subjective performance assessments; incentives for skill development rather than simply for effort; and incentive contracts between versus within organizations. I con- Management, Sloan School, Massachu- Robert Gibbons is Sloan Distinguished Professor of

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Section: Objective Performance Measurementmentioning

confidence: 99%

Incentives in Organizations

Gibbons

1998

Journal of Economic Perspectives

688

176

View full text Add to dashboard Cite

show abstract

“…In the first, Anderson, Burkhauser, and Raymond (1993) use data collected for disadvantaged adults in Tennessee who were first enrolled in a Title II-A program in 1987. A unique feature of this state-sponsored data set is that it includes detailed information on the personal characteristics of JTPA trainees that can be linked to program information.…”

Section: Retraining Workers In Marketable Skills 107mentioning

confidence: 99%

Assisting Workers Displaced by Structural Change: An International Perspective

Leigh¹

1995

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“…Dickinson and West also find that in states that adjusted standards for client mix, compared to states that did not do so (a former state option), SDAs served more adult welfare recipients and dropouts. Anderson et al (1993) find that JTPA clients are on average significantly more educated than the population of JTPA-eligibles. Although JTPA's performance standards may result in some creaming, these standards may also increase JTPA's value added.…”

mentioning

confidence: 81%

Using Performance Indicators to Improve the Effectiveness of Welfare-to-Work Programs

Bartik¹

1995

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The Effect of Creaming on Placement Rates Under the Job Training Partnership Act

Cited by 42 publications

References 0 publications

Incentives in Organizations

Incentives in Organizations

Assisting Workers Displaced by Structural Change: An International Perspective

Using Performance Indicators to Improve the Effectiveness of Welfare-to-Work Programs

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