Do responsible employers attract responsible employees?
By: Karine Nyborg
IZA World of Labour, May 2014.
Survey and register data indicate that many employees prefer a socially responsible employer, and are willing to accept a lower wage to achieve this. Laboratory experiments indicate that socially responsible groups are more productive than other groups, partly because they attract cooperative types, partly because initial cooperation is reinforced by group dynamics. Taken together, the findings indicate cost advantages for CSR firms. Socially responsble employers can pay lower wages, attract more cooperative employees, and benefit from a more cooperative and thus more productive firm culture. This helps CSR firms survive market competition, even if CSR in itself is costly. Empirical research on the topic is in its infancy, however, so findings must be interpreted with care.