Externalities in recruiting

External recruiting at least weakly improves the quality of the pool of applicants, but the incentive implications are less clear. Using a contest model, this paper investigates the pure incentive effects of external recruiting. Our results show that if workers are heterogeneous, opening up a firm's career system may lead to a homogenization of the pool of contestants and thus encourage the firm's high-ability workers to exert more effort. If this positive effect outweighs the discouragement of low-ability workers, the firm will benefit from external recruiting. If, however, the discouragement effect dominates the homogenization effect, the firm should disregard external recruiting. In addition, product market competition may mean that opening up the career system becomes less attractive for a firm since it increases the incentives of its competitors’ workers and hence strengthens the competitors.

Labor Regime and Social Justice: Consequences of Economic and Social Stratification among Maya Peasants in Central Quintana Roo, Mexico

The article explores consequences of socioeconomic stratification for milpa agriculture and for the organization of labor in a Lowland Maya peasant society. Both present-day and past situations are analyzed. The article includes a discussion of the concept of local social justice which serves as a framework of analysis of institutions that allocate goods and services and provide rules and norms for social interaction.