According to most simple agency models only the performance dependent part of the compensation drives the agent’s effort decision. However, we show that this is not necessarily the case for reference dependent and loss averse agents. Based on Pokorny (2008) we firstly analyze the impact of the...

We examine the benefits of objective performance measurement in a field experiment conducted in a retail bank. At the outset objective performance measures of pro fits in each branch were only available on the branch level and managers allocated bonuses to their employees based on subjective...

To examine the influence of working hours on employees' satisfaction, this article uses a large, representative set of panel data from German households (GSOEP). The results show that high working hours and overtime in general do not lead to decreased satisfaction. Rather, increasing working...

In vielen psychologischen Studien wurde gezeigt, dass Performance-Feedback als Motivator innerhalb einer Arbeitsbeziehung wirkt. In diesem Papier soll nun die Wirkung von Feedback mit Methoden der OEkonomie untersucht werden. Dazu wird der Einfluss von Feedback auf die Arbeitsanstrengung des...

We provide an explanation for peer pressure in teams based on inequity aversion. Analyzing a two-period model with two agents, we find that the effect of inequity aversion strongly depends on the information structure. When contributions are unobservable, agents act as though they were purely...