Expectations, Wage Hikes, and Worker Voice: Evidence from a Field Experiment

Abstract

Hirschman's (1970) seminal thesis that enabling worker "voice" prevents exit from the employment relationship has played a foundational role in labor economics. We provide the first experimental test of this hypothesis in a real-world setting via a randomized controlled trial in Indian garment factories. Just after what proved to be a disappointing wage hike, workers were chosen at random to participate in an anonymous survey in which they were asked for feedback on job conditions, supervisor performance, and overall job satisfaction. Enabling voice in this manner reduced turnover and absenteeism after the hike, particularly for the most disappointed workers.

Voice and Political Engagement: Evidence from a Field Experiment

“…We also contribute to a growing literature on voice and worker representation in firms (Adhvaryu et al, 2021;Harju et al, 2021;Jäger et al, 2021). Adhvaryu et al (2021) show that workers quit when wage increases do not meet their expectations, but enabling voice mitigates this exit.…”

“…We also contribute to a growing literature on voice and worker representation in firms (Adhvaryu et al, 2021;Harju et al, 2021;Jäger et al, 2021). Adhvaryu et al (2021) show that workers quit when wage increases do not meet their expectations, but enabling voice mitigates this exit. More broadly, our findings on the mechanisms, which highlight a role for members being valued by the party, relate to the idea that the extent to which workers feel valued, is a key determinant of firm performance (Adhvaryu et al, 2019;Ashraf and Bandiera, 2018;Bandiera et al, 2009;Hoffman and Tadelis, 2021).…”

Globalization and Female Empowerment: Evidence from Myanmar

“…In the regressions, we control for a a dummy equal 33 Indeed, in our factory data, worker turnover rate is negatively associated with the working conditions score (available upon request). In addition, experimental evidence from garment factories in India show that better communication between management and workers can reduce the turnover rate (Adhvaryu et al, 2019).…”

When Labor Enforcement and Immigration Enforcement Collide: Deterring Worker Complaints Worsens Workplace Safety

“…For example, Adhvaryu et al (2019) and Harju et al (2021) test whether greater opportunity for voice reduces worker turnover. Finally, we complement studies that investigate the determinants and effects of complaining in other domains, including worker complaints about sexual harassment (Dahl and Knepper, 2021), citizen complaints about police misconduct (Ba, 2018) and whistle-blowing about Medicare fraud (Leder-Luis, 2021).…”