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Consider a principal-agent relationship in which more effort by the agent raises the likelihood of success. Does rewarding success, i.e., paying a bonus, increase effort in this case? I find that bonuses have not only an incentive but also an income effect. Overall, bonuses paid for success may...
Persistent link: https://www.econbiz.de/10012775692
rationality can affect effort provision, by shrouding attributes of the incentives. In our setting, complexity leads workers to …
Persistent link: https://www.econbiz.de/10014347039
Within a laboratory experiment we investigate a principal-agent game in which agents may,first, self-select into a group task (GT) or an individual task (IT) and, second, choose workeffort. In their choices of task and effort the agents have to consider pay contracts for bothtasks as offered by...
Persistent link: https://www.econbiz.de/10005863219
Within a laboratory experiment we investigate a principal-agent game in which agents may, first, self-select into a group task (GT) or an individual task (IT) and, second, choose work effort. In their choices of task and effort the agents have to consider pay contracts for both tasks as offered...
Persistent link: https://www.econbiz.de/10013317147
Simple bargaining games are the foundation of more complex social interactions necessary for healthy relationships and well‐functioning societies. Neuroscience research has shown that high‐level deliberative thinking processes are necessary for social‐decision making - it seems cognitively...
Persistent link: https://www.econbiz.de/10013000072
the fairness and unfairness of allocations in three different scenarios (a Dictator game, an Ultimatum game, and a Trust … same session we elicit again their principles regarding the fairness and unfairness of allocations in the same three … norm in its favor and the weak side agrees: Stated fairness is a compromise with power. Second, in most situations …
Persistent link: https://www.econbiz.de/10013104971
among a substantial share of the population into account. Theory shows and experiments confirm, that even if fairness … incompleteness and relational nature of most employment contracts and (ii) the existence of reference-dependent fairness concerns … fairness on effort, derive predictions from our approach for entry-level wages and incumbent workers' wages, confront these …
Persistent link: https://www.econbiz.de/10012768171
particular, we analyze how horizontal fairness concerns affect performance and efficiency in an environment characterized by …. This is not caused by monetary incentives per se since under both wage schemes it is profit-maximizing for agents to exert …
Persistent link: https://www.econbiz.de/10013158119
We analyze the impact of imperfect contract enforcement on the emergence of unemployment. In an experimental labor market where trading parties can form long-term employment relationships, we compare a work environment where effort is observable, but not verifiable to a situation where explicit...
Persistent link: https://www.econbiz.de/10013141722
The importance of fair and equal treatment of workers is at the heart of the debate in organizational management. In this regard, we study how reward mechanisms and production technologies affect effort provision in teams. Our experimental results demonstrate that unequal rewards can potentially...
Persistent link: https://www.econbiz.de/10012749898