Employee matching grant schemes are coordination mechanisms that reduce free-riding by socially conscious employee-donors. Matching schemes coupled with lower take-home pay than offered by non-matching firms will survive capital and labor market competition if employee type is not observable and socially conscious employees are more productive or value working together. Matching can enhance employee welfare and raise more for charity without reducing profits. We document that matching firms have higher labor productivity and are more likely to be ranked as one of the “100 Best” employers. The result is robust to managerial entrenchment concerns and is not confined to the high-tech sector.
History
Journal
Review of finance
Volume
23
Pagination
199-243
Location
Oxford, Eng.
ISSN
1572-3097
eISSN
1573-692X
Language
eng
Publication classification
C Journal article, C1 Refereed article in a scholarly journal