%0 Journal Article
%J The Accounting Review
%D 2020
%T Selection benefits of below-market pay in social-mission organizations: effects on individual performance and team cooperation
%A Chen,Clara
%A Pesch,Heather
%A Wang,Laura
%K Accounting
%X Many organizations whose core purpose is to advance a social mission pay employees below-market wages. We investigate two under-appreciated benefits of below-market pay in these social-mission organizations. In a series of experiments, we predict and find that, holding employees’ outside opportunities constant, those attracted to social-mission organizations that pay below-market wages perform better individually and cooperate more effectively in teams than those attracted to social-mission organizations that pay higher wages. The individual performance effect arises because below-market pay facilitates the selection of value-congruent employees who are naturally inclined to work hard for the organizational mission. The team cooperation effect arises because employees expect team members who have selected a social-mission job that pays below market to be more value-congruent and, therefore, more cooperative than those who have selected a social-mission job that pays higher wages. Collectively, we demonstrate that in social-mission organizations, offering below-market pay can yield selection benefits.
%B The Accounting Review
%V 95
%P 57-77
%8 2020
%G eng
%N 1
%2 a
%4 189097000960
%$ 189097000960