Signaling and Screening of Workers' Motivation

Josse Delfgaauw and Robert Dur

No 02-050/3, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: This paper develops a model in which workers are heterogeneous in their intrinsic motivation to work at a firm. We characterise optimal incentive schemes and examine how the firm can attract and select highly motivated workers to fill a vacancy when workers’ motivation is private information. While posting a higher wage increases the probability of filling the vacancy, it decreases the expected average quality of job applicants because less motivated workers are induced to apply. The optimal wage scheme entails a trade-off between the probability of filling the vacancy, the rents left to the worker, and the expected worker's motivation.

This discussion paper has resulted in a publication in the Journal of Economic Behavior and Organization , 62(4), 605-24.

Keywords: signaling and screening models; intrinsic motivation; monetary incentive schemes; minimum wages. (search for similar items in EconPapers)
JEL-codes: D82 J31 J42 (search for similar items in EconPapers)
Date: 2002-05-28, Revised 2005-03-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Signaling and screening of workers' motivation (2007)
Working Paper: Signaling and Screening of Workers' motivation (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20020050

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