Events at CERGE-EI

Prof. Hodaka Morita

University of New South Wales, Sydney, Australia

Authors: Jed DeVaro, Nan Maxwell, and  Hodaka Morita

Abstract: We develop a theoretical model in which for-profit and nonprofit employers compete to hire a worker who derives intrinsic motivation from the nonprofit’s social mission. We also use a unique data set of California establishments to provide new evidence on sectorial differences in pay and HRM systems, finding a greater incidence of training and benefits in nonprofits, lower wages (with the wage gap increasing in skill level), and less incentive pay than in for-profits. The model is used to interpret both this new evidence and other empirical results from the literature, including the inconclusive sign of the FP-NP wage differential.

Keywords: nonprofits, incentive pay, intrinsic motivation, compensating differentials, fringe benefits, training

Full Text: “Compensation and Intrinsic Motivation in Nonprofit and For-Profit Organizations”