Moral Hazard on Productivity Among Work-From-Home Workers Amid the COVID-19 Pandemic

Abstract: After the outbreak of COVID 19, firms appear to monitor Work From Home (WFH) workers more than ever out of anxiety that workers may shirk at home or implement moral hazard at home. Using the Survey of Working Arrangements and Attitudes (SWAA, Barrero et al., 2021), the evidence of WFH workers' ex post moral hazard as well as its specific aspects are examined. The results show that the ex post moral hazard among the WFH workers is generally found. Interestingly, however, the moral hazard on specific type of productivity, efficiency, is not detected for the workers at firms with WFH friendly policy for long term. Moreover, the advantages & challenges for the WFH culture report that workers with health or disability issues improve their productivity, whereas certain conditions specific to the WFH environment must be met.