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Status Concerns and the Organization of Work

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Author Info

  • Fershtman, C.
  • Weiss, Y.
  • Hvide, H.K.

Abstract

We study the effects of local status, where workers compare their wage to the wage of other workers within the same firm. We assume a competitive labor market with unobservable effort, where firms condition wages on output as incentive for effort. If workers who care about status are also more productive, such status concerns generate an equilibrium with heterogenous firms where workers who care and workers who do not care about status work together.

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Bibliographic Info

Paper provided by Tel Aviv in its series Papers with number 2001-2.

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Length: 44 pages
Date of creation: 2001
Date of revision:
Handle: RePEc:fth:teavfo:2001-2

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Postal: Israel TEL-AVIV UNIVERSITY, THE FOERDER INSTITUTE FOR ECONOMIC RESEARCH, RAMAT AVIV 69 978 TEL AVIV ISRAEL.
Phone: 972-3-640-9255
Fax: 972-3-640-5815
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Web page: http://econ.tau.ac.il/research/foerder.asp
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Related research

Keywords: WAGES ; WORKERS ; DISCRIMINATION;

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Citations

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Cited by:
  1. Kräkel, Matthias, 2005. "Emotions and the Optimality of Unfair Tournaments," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 45, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
  2. Glazer, Amihai & Kanniainen, Vesa & Poutvaara, Panu, 2004. "Initial Luck, Status-Seeking and Snowballs Lead to Corporate Success and Failure," IZA Discussion Papers 1426, Institute for the Study of Labor (IZA).
  3. Antonio Cabrales & Antoni Calvó, 2002. "Social preferences and skill segregation," Economics Working Papers 629, Department of Economics and Business, Universitat Pompeu Fabra.
  4. Emmanuelle Auriol & Régis Renault, 2007. "Status and Incentives," THEMA Working Papers 2007-01, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  5. Robert Dur & Amihai Glazer, 2004. "Optimal Incentive Contracts For a Worker Who Envies His Boss," CESifo Working Paper Series 1282, CESifo Group Munich.
  6. Abigail Barr & Pieter Serneels, 2004. "Wages and Reciprocity in the Workplace," Economics Series Working Papers WPS/2004-18, University of Oxford, Department of Economics.
  7. Andrea Patacconi & Florian Ederer, 2005. "Interpersonal Comparison, Status and Ambition in Organisations," Economics Series Working Papers 222, University of Oxford, Department of Economics.
  8. Cabrales Goitia Antonio & Calvó-Armengol Antoni & Pavoni Nicola, 2007. "Social Preferences, Skill Segregation and Wage Dynamics," Working Papers 201053, Fundacion BBVA / BBVA Foundation.
  9. Auriol, Emmanuelle & Renault, Régis, 2000. "The Costs and Benefits of Symbolic Differentiation in the Work Place," IDEI Working Papers 101, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2002.
  10. Antonio Cabrales & Antoni Calvó-Armengol, 2005. "Aversion to Inequality and Segregating Equilibria," Working Papers 177, Barcelona Graduate School of Economics.

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