How do different characteristics of pay-for-performance schemes affect fairness perceptions? In two studies, we systematically consider three major classes of incentive schemes: continuous piece rate incentives, discrete bonus schemes, and tournament incentives. We find that pay inequality has a...

We conduct a general analysis of the effects of inequality aversion on decisions by homogeneous players in static and dynamic games. We distinguish between direct and indirect effects of inequality aversion. Direct effects are present when a player changes his action to affect disutility caused...

This work is based on a differential game proposed by Kelvin Lancaster. The game between two agents called workers and capitalists is based on the accumulation and redistribution of benefits among social classes concluding that cooperative outcomes outperform non-cooperative. This approach...

This article studies how distributional tensions can act in many different ways depending on the social affinity between the different economic classes and their prospect of upward or downward mobility. We consider that socioeconomic group membership through its implied social interactions and...

In a public good economy the distribution of initial income is an important determinant of how many individuals contribute to the public good. For the case when all individuals have identical preferences in this paper a simple formula is derived that describes the proportion of all income...