The wage policy of a German and a U.S. firm is comparatively analysed with a focus on the relation between wages and hierarchies. While prior studies examine only one particular firm, in this paper two plants of the same owners with similar production processes in different institutional...

The theory of compensating wage differentials is generally accepted. Still, there has been no strong or even contrary evidence for compensating wage differentials in Germany so far. Estimating wage regressions with data of the German Socio-Economic Panel (GSOEP) within individually perceived...

We provide an explanation for peer pressure in teams based on inequity aversion. Analyzinga two-period model with two agents, we find that the effect of inequity aversion stronglydepends on the information structure. When contributions are unobservable, agents act as ifthey were purely selfish....

A model is analyzed in which agents exert effort to create innovations within an organization. When payments are infeasible, the decision on the implementation of a proposal is shown to bemadeby simplemonotonic decision rules. A trade-off arises between the use of information and the incentives...

Die vorliegende Studie beleuchtet das Problem der Motivationsverdrängung bei Anreizsetzung durch Stücklöhne. Modelliert wird eine einfache experimentelle Prinzipal-Agenten-Beziehung. In einer ersten Bedingung kann der Prinzipal einen fixen Transfer an einen Agenten leisten. In einer zweiten...

A theory of responsibility is provided in a simple model where agents care for their career prospects. First, two agents with uncertain abilities work on a task. Second, a principal decides to promote one of them. Three types of equilibria occur. One in which no agent is responsible for the task...

The connection between strategic change and managerial turnover is studied within a model where managers decide on a firm's strategy. Managers as well as firm owners care for the long-term success of a company. But managers are also interested in their own reputation. Due to reputational...

If a manager stays in office for a long time he will have learned much about his subordinates. Thus competition among them will be weak as the manager has made up his mind who is suited best for which position. With a new manager the "race" for favorable tasks is restarted leading subordinates...

We study the determinants of biases in subjective performance evaluations in an MTurk experiment to test the implications of a standard formal framework of rational subjective evaluations. In the experiment, subjects in the role of workers work on a real effort task. Subjects in the role of...

Any opinions expressed here are those of the author(s) and not those of IZA. Research published inthis series may include views on policy, but the institute itself takes no institutional policy positions.The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international...