Chapter

Does Employee Ignorance Undermine Shared Capitalism?

John W. Budd

in Shared Capitalism at Work

Published by University of Chicago Press

Published in print May 2010 | ISBN: 9780226056951
Published online February 2013 | e-ISBN: 9780226056968 | DOI: http://dx.doi.org/10.7208/chicago/9780226056968.003.0010
Does Employee Ignorance Undermine Shared Capitalism?

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This chapter discusses employer-provided shared capitalism and employee relationship. Employee ignorance might very well undermine shared capitalism, though this ignorance might stem from ineffective corporate communications and uneven implementation in addition to employee inattentiveness. An analysis of the NBER Shared Capitalism data set of thousands of employee responses linked to company-provided information from fourteen private-sector organizations reveals significant fractions of employees whose perceptions of whether or not they are covered by various shared capitalism programs do not match their employers' policies. In addition to employee ignorance, the analyses document significant numbers of false positive responses—that is, employees that believe they are covered by a shared capitalism program when their employer states that they are not. This aspect of overall inaccuracy might not undermine the incentive intentions of shared capitalism if perception becomes reality: workers that believe they are covered by an incentive-based plan.

Keywords: shared capitalism; incentives; employee-employer relationship; employee ignorance; communication; incentive-based plan

Chapter.  10281 words.  Illustrated.

Subjects: Economic History

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