Organizational governance and trade-offs between pay and subjective employee well-being: a comparative analysis

John W. Budd and J Ryan Lamare

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: The incompleteness of labour contracts is expected to cause uncertainty among forward-looking employees as to whether implicit contracts with greater intrinsic rewards in lieu of pay will be breached by employers, thus reducing employee well-being. David Marsden theorized that an organization's form of governance can serve as a stable, easy-to-observe signal of the likelihood of a breach, and thus employees across governance types will exhibit different extrinsic–intrinsic trade-offs. Using the European Working Conditions Survey, we extend Marsden's theory and find supportive evidence across 35 European countries and 9 governance categories. We also extend Marsden's theorizing into the comparative domain and analyse patterns of subjective well-being, compensatory pay and organizational governance across varieties of political economies.

JEL-codes: J01 J50 R14 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2024-11-19
New Economics Papers: this item is included in nep-hap
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Published in British Journal of Industrial Relations, 19, November, 2024. ISSN: 0007-1080

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