Anti-Poaching Agreements in Labor Markets

Research output: Contribution to journalArticleScientificpeer-review

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.
Original languageEnglish
Peer-reviewed scientific journalEconomic Inquiry
Volume57
Issue number1
Pages (from-to)243-263
Number of pages22
ISSN0095-2583
DOIs
Publication statusPublished - 28.07.2018
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management
  • Anti-poaching agreements
  • wage competition
  • anticompetitive behavior
  • poaching offers
  • switching employers
  • labor mobility
  • productivity

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