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Workers' Responses to Incentives: The Case of Pending MLB Free Agents

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Author Info

  • Joshua Congdon-Hohman

    ()
    (Department of Economics, College of the Holy Cross)

  • Jonathan A. Lanning

    ()
    (Department of Economics, Bryn Mawr)

Abstract

This study examines ways in which workers respond to implicit incentives. Specifically, we examine the extent to which workers shift their effort to activities that are measured and which have been previously rewarded in the labor market. To examine this question, we examine the changes in the performance measures of professional baseball players in the season prior to the opportunity to freely negotiate their contract (free agency). We will examine different eras in baseball to examine if we can identify changes in behavior in this pivotal year based on changes to the current premium outputs for each time period.

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File URL: http://college.holycross.edu/RePEc/hcx/Congdon-Lanning_FreeAgents.pdf
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Bibliographic Info

Paper provided by College of the Holy Cross, Department of Economics in its series Working Papers with number 1304.

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Length: 35 pages
Date of creation: Jul 2013
Date of revision:
Handle: RePEc:hcx:wpaper:1304

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Web page: http://www.holycross.edu/departments/economics/website/
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Related research

Keywords: Agency theory; strategic performance; opportunistic behavior; baseball;

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  1. Bruce Shearer, 2004. "Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment," Review of Economic Studies, Wiley Blackwell, vol. 71(2), pages 513-534, 04.
  2. Paarsch, Harry J. & Shearer, Bruce, 1996. "Piece Rates, Fixed Wages, and Incentive Effects: Statistical Evidence from Payroll Records," Cahiers de recherche 9623, Université Laval - Département d'économique.
  3. Heywood, John S. & Wei, Xiangdong & Ye, Guangliang, 2011. "Piece rates for professors," Economics Letters, Elsevier, vol. 113(3), pages 285-287.
  4. David J. Berri & Anthony C. Krautmann, 2006. "Shirking on the Court: Testing for the Incentive Effects of Guaranteed Pay," Economic Inquiry, Western Economic Association International, vol. 44(3), pages 536-546, July.
  5. Bruce Shearer, 2004. "Piece Rates, Fixed Wages and Incentives: Evidence from a Field Experiment," Review of Economic Studies, Oxford University Press, vol. 71(2), pages 513-534.
  6. Lazear, Edward P, 1986. "Salaries and Piece Rates," The Journal of Business, University of Chicago Press, vol. 59(3), pages 405-31, July.
  7. Jensen, Michael C & Murphy, Kevin J, 1990. "Performance Pay and Top-Management Incentives," Journal of Political Economy, University of Chicago Press, vol. 98(2), pages 225-64, April.
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