In Bartling, Fehr and Schmidt (2012) we show theoretically and experimentally that it is optimal to grant discretion to … workers if (i) discretion increases productivity, (ii) workers can be screened by past performance, (iii) some workers … reciprocate high wages with high effort and (iv) employers pay high wages leaving rents to their workers. In this paper we show …

I examine whether reference points can provide an explanation for rigid wages in recessions. Even though a recession … provides a good reason to adjust wages downward, workers' perception of a "fair wage" may depend on their previous wage, their … stipulated wages-can serve as reference points. My experimental results show that with initial contracts workers punish wage cuts …

Workers participating in firm-sponsored training receive higher wages as a result. But given that firms pay the …

We investigate the effects of works councils on employees' wages and job satisfaction in general and for subgroups with … support for the hypothesis that the introduction of a works council itself increases wages or job satisfaction for the …