The unintended consequences of meritocratic government hiring

Geromichalos, Athanasios; Kospentaris, Ioannis

doi:10.1016/j.euroecorev.2022.104093

Cited by 6 publications

(2 citation statements)

References 46 publications

(40 reference statements)

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“…However, nepotism in hiring of public-sector employees may discourage workers from applying for public-sector jobs (Chassamboulli & Gomes, 2021). It has also been argued that due to high wages, highly skilled workers join the public sector and private sector employment is crowded out (Hyder & Reilly, 2005), which in turn can discourage the private sector from making investments to create jobs, which leads to higher unemployment and lower GDP growth (Geromichalos & Kospentaris, 2022). Moreover, higher public expenditure on salaries can result in the crowding-out of pro-poor expenditures in developing countries (Zouhar, 2012).…”

Section: Public-private Wage Differentials: Evidence From Pakistan 1 ...mentioning

confidence: 99%

Public-Private Wage Differentials: Evidence from Pakistan

Akram

2022

LJE

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Compensation structures of public sector employees have significant implications for public service delivery and employment. If public sector employees get relatively lower pay, then the government can face difficulties in retaining trained and qualified workers. However, if public sector employees receive higher salaries it is possible that younger people may prefer to join the public sector. If this is accompanied by limited job absorption capacity in the public sector, it is possible for there to be substantial unemployment. This study has analysed the wage differentials by using the data from the Pakistan Labour Force Survey 2020-21. Blinder-Oaxaca decomposition suggests that at the executive level, public sector workers are facing wage penalties, while other occupational groups in the public sector are enjoying wage premiums. The highest wage premiums are for clerical staff followed by unskilled workers, services, technician, professionals and agricultural workers

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Section: Public-private Wage Differentials: Evidence From Pakistan 1 ...mentioning

confidence: 99%

Public-Private Wage Differentials: Evidence from Pakistan

Akram

2022

LJE

View full text Add to dashboard Cite

show abstract

“…Chassamboulli and Gomes (2021) study the role of nepotism in public sector hiring. In a model with workers heterogeneous in ability, Geromichalos and Kospentaris (2022) study how workers' selection into the public sector affects macroeconomic aggregates.…”

Section: Introductionmentioning

confidence: 99%