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Abstract for:

Does Employee Happiness Have an Impact on Productivity?

Clément S.  Bellet,  Jan-Emmanuel  De Neve,  George  Ward,  October 2019
Paper No' CEPDP1655: | Full paper (pdf)
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Keywords: happiness, productivity

JEL Classification: D03; J24; M5; I31

Is hard copy/paper copy available? YES - Paper Copy Still In Print.
This Paper is published under the following series: CEP Discussion Papers
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Abstract:

This article provides quasi-experimental evidence on the relationship between employee happiness and productivity in the field. We study the universe of call center sales workers at British Telecom (BT), one of the United Kingdom's largest private employers. We measure their happiness over a 6 month period using a novel weekly survey instrument, and link these reports with highly detailed administrative data on workplace behaviors and various measures of employee performance. Exploiting exogenous variation in employee happiness arising from weather shocks local to each of the 11 call centers, we document a strong causal effect of worker happiness on sales. This is driven by employees working more effectively on the intensive margin by making more calls per hour, adhering more closely to their workflow schedule, and converting more calls into sales when they are happier. In our restrictive setting, we find no effects on the extensive margin of happiness on various measures of high-frequency labor supply such as attendance and break-taking.