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Interactions Between Workers and the Technology of Production: Evidence from Professional Baseball

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  • Gould, Eric D
  • Winter, Eyal

Abstract

This paper examines how the effort choices of workers within the same firm interact with each other. In contrast to the existing literature, we show that workers can affect the productivity of their co-workers based on income maximization considerations, rather than relying on behavioural considerations such as peer pressure, social norms, and shame. Theoretically, we show that a worker's effort has a positive effect on the effort of co-workers if they are complements in production, and a negative effect if they are substitutes. The theory is tested using panel data on the performance of baseball players from 1970 to 2003. The empirical analysis shows that a player's batting average significantly increases with the batting performance of his peers, but decreases with the quality of the team's pitching. Furthermore, a pitcher's performance increases with the pitching quality of his team-mates, but is unaffected by the batting output of the team. These results are inconsistent with behavioural explanations which predict that shirking by any kind of worker will increase shirking by all fellow workers. The results are consistent with the idea that the effort choices of workers interact in ways that are dependent on the technology of production. These findings are robust to controlling for individual fixed-effects, and to using changes in the composition of one's co-workers in order to produce exogenous variation in the performance of one's peers.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6527.

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Date of creation: Oct 2007
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Handle: RePEc:cpr:ceprdp:6527

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Keywords: Externalities; Peer Effects; Team Production;

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References

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  1. Brian A. Jacob, 2004. "Public Housing, Housing Vouchers, and Student Achievement: Evidence from Public Housing Demolitions in Chicago," American Economic Review, American Economic Association, vol. 94(1), pages 233-258, March.
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  3. Eyal Winter, 2004. "Incentives and Discrimination," American Economic Review, American Economic Association, vol. 94(3), pages 764-773, June.
  4. Eric D. Gould & Victor Lavy & M. Daniele Paserman, 2009. "Does Immigration Affect the Long-Term Educational Outcomes of Natives? Quasi-Experimental Evidence," Economic Journal, Royal Economic Society, vol. 119(540), pages 1243-1269, October.
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  11. Gould, Eric D & Lavy, Victor & Paserman, Marco Daniele, 2003. "Immigrating to Opportunity: Estimating the Effect of School Quality Using a Natural Experiment on Ethiopians in Israel," CEPR Discussion Papers 4052, C.E.P.R. Discussion Papers.
  12. Angrist, Joshua & Lang, Kevin, 2004. "Does School Integration Generate Peer Effects? Evidence from Boston's Metco Program," IZA Discussion Papers 976, Institute for the Study of Labor (IZA).
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Citations

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Cited by:
  1. Gould, Eric & Kaplan, Todd R, 2010. "Learning unethical practices from a co-worker: the peer effect of Jose Canseco," MPRA Paper 24232, University Library of Munich, Germany.
  2. Alex Bryson & Rafael Gomez & Kerry L. Papps, 2010. "Heterogeneous Worker Ability and Team-Based Production: Evidence from Major League Baseball, 1920-2009," CEP Discussion Papers dp1015, Centre for Economic Performance, LSE.
  3. R Simmons & D J Berri, 2010. "Mixing the princes and the paupers: Pay and performance in the National Basketball Association," Working Papers 611523, Lancaster University Management School, Economics Department.
  4. Simmons, Rob & Berri, David J., 2011. "Mixing the princes and the paupers: Pay and performance in the National Basketball Association," Labour Economics, Elsevier, vol. 18(3), pages 381-388, June.
  5. repec:lan:wpaper:3659 is not listed on IDEAS
  6. Papps, Kerry L., 2010. "Productivity under Large Pay Increases: Evidence from Professional Baseball," IZA Discussion Papers 5133, Institute for the Study of Labor (IZA).
  7. repec:lan:wpaper:3944 is not listed on IDEAS
  8. Sander Hoogendoorn & Simon C. Parker & Mirjam van Praag, 2012. "Ability Dispersion and Team Performance: A Field Experiment," Tinbergen Institute Discussion Papers 12-130/VII, Tinbergen Institute.
  9. repec:lan:wpaper:3551 is not listed on IDEAS
  10. Natalia Montinari, 2011. "The Dark Side of Reciprocity," Jena Economic Research Papers 2011-052, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.

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