Do Employees Care about their Relative Position? Behavioural Evidence Focusing on Performance
AbstractDo employees care about their relative (economic) position among co-workers in an organization? And if so, does it raise or lower their performance? Behavioral evidence on these important questions is rare. This paper takes a novel approach to answering these questions, working with sports data from two different disciplines, basketball and soccer. These sports tournaments take place in a controlled environment defined by the rules of the game. We find considerable support that positional concerns and envy reduce individual performance. In contrast, there does not seem to be any tolerance for income disparity, based on the hope that such differences signal that better times are under way. Positive behavioral consequences are observed for those who are experiencing better times.
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Bibliographic InfoPaper provided by Center for Research in Economics, Management and the Arts (CREMA) in its series CREMA Working Paper Series with number 2008-12.
Date of creation: Apr 2008
Date of revision:
Relative income; positional concerns; envy; social comparison; relative derivation; performance;
Other versions of this item:
- Benno Torgler & Markus Schaffner & Sascha L. Schmidt & Bruno S.Frey, 2008. "Do Employees Care About Their Relative Position? Behavioural Evidence Focusing on Performance," School of Economics and Finance Discussion Papers and Working Papers Series 231, School of Economics and Finance, Queensland University of Technology, revised 16 Jun 2008.
- D00 - Microeconomics - - General - - - General
- D60 - Microeconomics - - Welfare Economics - - - General
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-05-17 (All new papers)
- NEP-CBE-2008-05-17 (Cognitive & Behavioural Economics)
- NEP-LAB-2008-05-17 (Labour Economics)
- NEP-SOC-2008-05-17 (Social Norms & Social Capital)
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