Skip to content
Licensed Unlicensed Requires Authentication Published by De Gruyter July 25, 2017

Does Job Satisfaction Increase Sales and Customer Satisfaction? Evidence from Retail Banking in South Korea

  • Ricard Gil , Myongjin Kim EMAIL logo and Inhyouk Koo

Abstract

This paper estimates the causal relationship between job satisfaction and worker productivity. Using personnel records from a retail bank in South Korea, we show that branch productivity is positively associated to average job satisfaction, but negatively to its standard deviation. We address endogeneity concerns using IV strategies and find that while higher job satisfaction may increase short term productivity through sales to existing customers, excessive sales to existing customers may hurt customer satisfaction and willingness to recommend in the long run. Our findings suggest that average job satisfaction and its dispersion are equally important to understand worker productivity.

JEL Classification: J24; J28; M50

Acknowledgements

We would like to thank Daniel Hicks, Gregory Burge, Le Wang, Timothy Bond, the brown bag attendants at the University of Oklahoma, the editor and two anonymous reviewers for their constructive comments. The usual disclaimer applies.

References

Angrist, Joshua D. 2014. “The Perils of Peer Effects.” Labour Economics 30:98–108.10.3386/w19774Search in Google Scholar

Baker, George, Gibbs Michael, and Holmstrom Bengt. 1994. “The Internal Economics of the Firm: Evidence from Personnel Data.” Quarterly Journal of Economics 109 (4):881–919.10.2307/2118351Search in Google Scholar

Behrman, Douglas, Bigoness William, and William Jr. Perreault. 1981. “Sources of Job Related Ambiguity and Their Consequences upon Salespersons’ Job Satisfaction and Performance.” Management Science 27 (11):1246–60.10.1287/mnsc.27.11.1246Search in Google Scholar

Berry, S., Levinsohn J., and Pakes A. 1995. “Automobile Prices in Market Equilibrium.” Econometrica 63:841–90.10.2307/2171802Search in Google Scholar

Bockerman, Petri, and Ilmakunnas Pekka. 2012. “The Job Satisfaction-Productivity Nexus: A Study Using Matched Survey and Register Data.” Industrial and Labor Relations Review 65:244–62.10.1177/001979391206500203Search in Google Scholar

Booth, Alison and Jan Van Ours. 2008. “Job Satisfaction and Family Happiness: The Part-Time Work Puzzle.” The Economic Journal 118 (526):F77–99.10.1111/j.1468-0297.2007.02117.xSearch in Google Scholar

Card, David, Mas Alexandre, Moretti Enrico, and Saez Emmanuel. 2012. “Inequality at Work: The Effect of Peer Salaries on Job Satisfaction.” American Economic Review 102 (6):2981–3003.10.3386/w16396Search in Google Scholar

Chen B., Tong L., and Varshney P. K. 2006. “Channel-Aware Distributed Detection in Wireless Sensor Networks.” IEEE Signal Processing Magazine 23 (4):16–26.10.1109/MSP.2006.1657814Search in Google Scholar

Clark, Andrew, Kristensen Nicolai, and Westergard-Nielsen Niels. 2007. “Job Satisfaction and Co-worker Wages: Status or Signal”. The Economic Journal 119 (536):430–447. Conference Papers (Mar., 2009).10.1111/j.1468-0297.2008.02236.xSearch in Google Scholar

Cole, M. S., Walter F., and Bruch H. 2008. “The Affective Mechanisms Linking Dysfunctional Behavior to Performance in Work Teams: A Moderated Mediation Study.” Journal of Applied Psychology 93:945–58.10.1037/0021-9010.93.5.945Search in Google Scholar

Donovan, D.T., Brown T.J. and Mowen J.C. 2004 “Internal Benefits of Service- Worker Customer Orientation: Job Satisfaction, Commitment, and Organizational Citizenship Behaviours.” Journal of Marketing 68 (1):128–46.10.1509/jmkg.68.1.128.24034Search in Google Scholar

Edmans, Alex. 2012. “The Link Between Job Satisfaction and Firm Value, with Implications for Corporate Social Responsibility.” Academy of Management Perspectives 26:1–19.10.5465/amp.2012.0046Search in Google Scholar

Edmans, Alex, Lucius Li, and Zhang Chendi. 2014. Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World. NBER Working Paper 20300.10.3386/w20300Search in Google Scholar

Fisher, Cynthia D. 2010. “Happiness at Work.” International Journal of Management Reviews 12 (4):384–12.10.1111/j.1468-2370.2009.00270.xSearch in Google Scholar

Freeman, Richard B. 1978. “Job Satisfaction as an Economic Variable.” American Economic Review 68:135–41.10.3386/w0225Search in Google Scholar

Frey, Bruno S., and Stutzer Alois. 2002. Happiness and Economics. Princeton: USA.10.1515/9781400829262Search in Google Scholar

Green, Colin, and Heywood John. 2008. “Does Performance Pay Increase Job Satisfaction?” Economica 75 (300):710–28.10.1111/j.1468-0335.2007.00649.xSearch in Google Scholar

Janssen, O. and Van Yperen N.W. 2004. “Employees’ Goal Orientations, the Quality of Leader- Member Exchange, and the Outcomes of Job Performance and Job Satisfaction.” Academy of Management Journal 45:368–84.10.2307/20159587Search in Google Scholar

Jones, Melanie, Jones Richard, Paul Paul L. Latreille, and Sloane Peter. 2008. “Training, Job Satisfaction and Workplace Performance in Britain: Evidence from WERS 2004.” Labour 23 (1):139–75.10.1111/j.1467-9914.2008.00434.xSearch in Google Scholar

Khwaja, Ahmed, and Yang Nathan. 2015. Sales Productivity and Employee Engagement: Evidence from Upselling in the Car Rental Industry. Manuscript, Yale University.Search in Google Scholar

Kristensen, Nicolai, and Niels Christian Westergard-Nielsen. 2004. “Does Low Job Satisfaction Lead to Job Mobility?” IZA Discussion paper series 1026.10.2139/ssrn.511722Search in Google Scholar

Lewbel, Arthur. 2012. “Using Heteroscedasticity to Identify and Estimate Mismeasured and Endogenous Regressor Models.” Journal of Business & Economic Statistics, Taylor & Francis Journals 30 (1):67–80.10.1080/07350015.2012.643126Search in Google Scholar

Liu, Dong, Mitchell Terence, Lee Thomas, Holtom Brooks, and Hinkin Timothy. 2012. “When Employees are Out of Step with Coworkers: How Job Satisfaction Trajectory and Dispersion Influence Individual- and Unit Level Voluntary Turnover.” Academy of Management Journal 55:1360–80.10.5465/amj.2010.0920Search in Google Scholar

Locke, Edwin. 1976. The Causes and Consequences of Job Satisfaction. Handbook of Industrial and Organizational Psychology.Search in Google Scholar

Oliver, Richard L. and Swan John E. 1989. “Equity and Disconfirmation Perceptions as Influences on Merchant and Product Satisfaction.” Journal of Consumer Research 16 (December):372–83.10.1086/209223Search in Google Scholar

Oswald, A., Proto E., and Sgroi D. 2009. “Happiness and Productivity.” Journal of Labor Economics 33 (4):789–22. (October 2015).10.1086/681096Search in Google Scholar

Published Online: 2017-7-25

© 2017 Walter de Gruyter GmbH, Berlin/Boston

Downloaded on 28.3.2024 from https://www.degruyter.com/document/doi/10.1515/bejeap-2016-0208/html
Scroll to top button