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- Title
ANTI‐POACHING AGREEMENTS IN LABOR MARKETS.
- Authors
Shy, Oz; Stenbacka, Rune
- Abstract
We analyze competition for experienced workers among wage‐setting firms. The firms can design poaching offers with higher wages to workers who switch from rivals relative to wages paid to their own existing employees. We evaluate the profit and welfare effects of anti‐poaching agreements that eliminate poaching offers as a recruiting method. Anti‐poaching agreements increase industry profits, whereas workers are made worse off. We show that the effects of anti‐poaching agreements on total welfare are determined by the magnitude of workers' switching costs and the productivity change associated with switching employers.
- Subjects
WAGES; LABOR productivity; EMPLOYEE recruitment; CORPORATE profits; LABOR market
- Publication
Economic Inquiry, 2019, Vol 57, Issue 1, p243
- ISSN
0095-2583
- Publication type
Article
- DOI
10.1111/ecin.12700