Burda, Michael C.; Güth, Werner; Kirchsteiger, Georg; … - 1998 - Rev.
One of the long-standing puzzles in economics is why wages do not fall sufficiently in recessions so as to avoid … employees to accept lower wages as well? As an alternative to reviewing statistical data, we have performed an experiment with a … two subjects in the highly stylized roles of employer and employee. Our hypothesis is that employers will not lower wages …