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Gift Exchange within a Firm : Evidence from a Field Experiment

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Author Info
Charles Bellemare

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Abstract

We present results from a field experiment testing the gift-exchange hypothesis inside a tree-planting firm paying its workforce incentive contracts. Firm managers told a crew of tree planters they would receive a pay raise for one day as a result of a surplus not attributable to past planting productivity. We compare planter productivity – the number of trees planted per day – on the day the gift was handed out with productivity on previous and subsequent days of planting on the same block, and thus under similar planting conditions. We find direct evidence that the gift had a significant and positive effect on daily planter productivity, controlling for planter-fixed effects, weather conditions and other random daily shocks. Moreover, reciprocity is the strongest when the relationship between planters and the firm is longterm.

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Publisher Info
Paper provided by The Field Experiments Website in its series Natural Field Experiments with number 0019.

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Date of creation: 2007
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Handle: RePEc:feb:natura:0019

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Web page: http://www.fieldexperiments.com

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Related research
Keywords: Reciprocity; gift exchange; incentive contracts; field experiments;

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Find related papers by JEL classification:
J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Akerlof, George A, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, MIT Press, vol. 97(4), pages 543-69, November. [Downloadable!] (restricted)
  2. Gary Charness, 2004. "Attribution and Reciprocity in an Experimental Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 22(3), pages 665-688, July. [Downloadable!]
    Other versions:
  3. Camerer, Colin & Babcock, Linda & Loewenstein, George & Thaler, Richard, 1996. "Labor Supply of New York City Cab Drivers: One Day At A time," Working Papers 960, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
    Other versions:
  4. Heike Hennig-Schmidt & Bettina Rockenbach & Abdolkarim Sadrieh, 2005. "In Search of Workers' Real Effort Reciprocity - A Field and a Laboratory Experiment," Discussion Papers 55, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich. [Downloadable!]
    Other versions:
  5. Fehr, Ernst & Gachter, Simon, 1998. "Reciprocity and economics: The economic implications of Homo Reciprocans1," European Economic Review, Elsevier, vol. 42(3-5), pages 845-859, May. [Downloadable!] (restricted)
  6. Carmichael, H Lorne & MacLeod, W Bentley, 1997. "Gift Giving and the Evolution of Cooperation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(3), pages 485-509, August.
    Other versions:
  7. Falk, Armin & Gachter, Simon & Kovacs, Judit, 1999. "Intrinsic motivation and extrinsic incentives in a repeated game with incomplete contracts," Journal of Economic Psychology, Elsevier, vol. 20(3), pages 251-284, June. [Downloadable!] (restricted)
  8. Dickinson, David L, 1999. "An Experimental Examination of Labor Supply and Work Intensities," Journal of Labor Economics, University of Chicago Press, vol. 17(4), pages 638-70, October. [Downloadable!] (restricted)
  9. Adriana D. Kugler & Gilles Saint-Paul, 2004. "How Do Firing Costs Affect Worker Flows in a World with Adverse Selection?," Journal of Labor Economics, University of Chicago Press, vol. 22(3), pages 553-584, July. [Downloadable!]
  10. Fehr, Ernst & Götte, Lorenz, 2004. "Do Workers Work More When Wages Are High? Evidence from a Randomized Field Experiment," IZA Discussion Papers 1002, Institute for the Study of Labor (IZA). [Downloadable!]
  11. Michel André Maréchal & Christian Thöni, 2007. "Do Managers Reciprocate? Field Experimental Evidence From a Competitive Market," University of St. Gallen Department of Economics working paper series 2007 2007-09, Department of Economics, University of St. Gallen. [Downloadable!]
  12. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2007. "Incentives for Managers and Inequality Among Workers: Evidence From a Firm-Level Experiment," The Quarterly Journal of Economics, MIT Press, vol. 122(2), pages 729-773, 05. [Downloadable!] (restricted)
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  13. Fehr, Ernst & Kirchsteiger, Georg & Riedl, Arno, 1995. "Gift Exchange and Reciprocity in Competitive Experimental Markets," Economics Series 14, Institute for Advanced Studies. [Downloadable!]
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  14. Armin Falk, 2007. "Gift Exchange in the Field," Econometrica, Econometric Society, vol. 75(5), pages 1501-1511, 09. [Downloadable!] (restricted)
  15. Simon, Herbert A, 1991. "Organizations and Markets," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 25-44, Spring. [Downloadable!] (restricted)
  16. Ernst Fehr & Lorenz Götte, 2005. "Do Workers Work More if Wages are High? Evidence from a Randomized Field Experiment," IEW - Working Papers iewwp125, Institute for Empirical Research in Economics - IEW. [Downloadable!]
    Other versions:
  17. R. Lynn Hannan & John H. Kagel & Donald V. Moser, 2002. "Partial Gift Exchange in an Experimental Labor Market: Impact of Subject Population Differences, Productivity Differences, and Effort Requests on Behavior," Journal of Labor Economics, University of Chicago Press, vol. 20(4), pages 923-951, October. [Downloadable!]
  18. James C. Cox & Cary A. Deck, 2005. "On the Nature of Reciprocal Motives," Economic Inquiry, Oxford University Press, vol. 43(3), pages 623-635, July. [Downloadable!] (restricted)
  19. Gachter, Simon & Falk, Armin, 2002. " Reputation and Reciprocity: Consequences for the Labour Relation," Scandinavian Journal of Economics, Blackwell Publishing, vol. 104(1), pages 1-26. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ernst Fehr & Martin Brown & Christian Zehnder, 2008. "On reputation: A microfoundation of contract enforcement and price rigidity," IEW - Working Papers iewwp384, Institute for Empirical Research in Economics - IEW. [Downloadable!]
    Other versions:
  2. Sebastian Kube & Michel André Maréchal & Clemens Puppe, 2008. "The Currency of Reciprocity - Gift-Exchange in the Workplace," IEW - Working Papers iewwp377, Institute for Empirical Research in Economics - IEW. [Downloadable!]
  3. Michel André Maréchal & Christian Thöni, 2007. "Do Managers Reciprocate? Field Experimental Evidence From a Competitive Market," University of St. Gallen Department of Economics working paper series 2007 2007-09, Department of Economics, University of St. Gallen. [Downloadable!]
  4. Shchetinin, Oleg, 2009. "Contracting Under Reciprocal Altruism," MPRA Paper 13457, University Library of Munich, Germany. [Downloadable!]
  5. Uschi Backes-Gellner & Donata Bessey & Kerstin Pull & Simone Tuor, 2008. "What Behavioural Economics Teaches Personnel Economics," Working Papers 0077, University of Zurich, Institute for Strategy and Business Economics (ISU). [Downloadable!]
  6. Florian Englmaier & Stephen Leider, 2008. "Contractual and Organizational Structure with Reciprocal Agents," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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