Advanced Search
MyIDEAS: Login to save this paper or follow this series

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

Contents:

Author Info

  • Gould, Eric D.

    ()
    (Hebrew University, Jerusalem)

  • Winter, Eyal

    ()
    (Hebrew University, Jerusalem)

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 behavioral 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 teammates, but is unaffected by the batting output of the team. These results are inconsistent with behavioral 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.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://ftp.iza.org/dp3096.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3096.

as in new window
Length: 33 pages
Date of creation: Oct 2007
Date of revision:
Publication status: published in: Review of Economics and Statistics, February 2009, 91(1), 188–200
Handle: RePEc:iza:izadps:dp3096

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: peer effects; team production; externalities;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

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.:
as in new window
  1. Bruce Sacerdote, 2000. "Peer Effects with Random Assignment: Results for Dartmouth Roommates," NBER Working Papers 7469, National Bureau of Economic Research, Inc.
  2. Edin, Per-Anders & Fredriksson, Peter & Ã…slund, Olof, 2000. "Ethnic enclaves and the economic success of immigrants - evidence from a natural experiment," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2000:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  3. Joshua D. Angrist & Kevin Lang, 2004. "Does School Integration Generate Peer Effects? Evidence from Boston's Metco Program," American Economic Review, American Economic Association, American Economic Association, vol. 94(5), pages 1613-1634, December.
  4. Edward L. Glaeser & Bruce Sacerdote & Jose A. Scheinkman, 1995. "Crime and Social Interactions," NBER Working Papers 5026, National Bureau of Economic Research, Inc.
  5. Oreopoulos, Philip, 2007. "The Long-Run Consequences of Living in a Poor Neighborhood," Berkeley Program on Housing and Urban Policy, Working Paper Series, Berkeley Program on Housing and Urban Policy qt9np9p7m5, Berkeley Program on Housing and Urban Policy.
  6. Caroline Hoxby, 2000. "Peer Effects in the Classroom: Learning from Gender and Race Variation," NBER Working Papers 7867, National Bureau of Economic Research, Inc.
  7. 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, Royal Economic Society, vol. 119(540), pages 1243-1269, October.
  8. Kandel, Eugene & Lazear, Edward P, 1992. "Peer Pressure and Partnerships," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 100(4), pages 801-17, August.
  9. Manski, Charles F, 1993. "Identification of Endogenous Social Effects: The Reflection Problem," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 60(3), pages 531-42, July.
  10. Eric A. Hanushek & John F. Kain & Steven G. Rivkin, 2009. "New Evidence about Brown v. Board of Education: The Complex Effects of School Racial Composition on Achievement," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 27(3), pages 349-383, 07.
  11. Bengt Holmstrom, 1981. "Moral Hazard in Teams," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 471, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  12. Holmstrom, Bengt & Milgrom, Paul, 1991. "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design," Journal of Law, Economics and Organization, Oxford University Press, Oxford University Press, vol. 7(0), pages 24-52, Special I.
  13. Andrea Ichino & Giovanni Maggi, 1999. "Work Environment and Individual Background: Explaining Regional Shirking Differentials in a Large Italian Firm," NBER Working Papers 7415, National Bureau of Economic Research, Inc.
  14. Brian A. Jacob, 2004. "Public Housing, Housing Vouchers, and Student Achievement: Evidence from Public Housing Demolitions in Chicago," American Economic Review, American Economic Association, American Economic Association, vol. 94(1), pages 233-258, March.
  15. Mas, Alexandre & Moretti, Enrico, 2006. "Peers at Work," IZA Discussion Papers 2292, Institute for the Study of Labor (IZA).
  16. Milgrom, Paul & Shannon, Chris, 1994. "Monotone Comparative Statics," Econometrica, Econometric Society, Econometric Society, vol. 62(1), pages 157-80, January.
  17. Todd D. Kendall, 2003. "Spillovers, Complementarities, and Sorting in Labor Markets with an Application to Professional Sports," Southern Economic Journal, Southern Economic Association, vol. 70(2), pages 389-402, October.
  18. Armin Falk & Andrea Ichino, 2004. "Clean Evidence on Peer Effects," Levine's Bibliography 666156000000000439, UCLA Department of Economics.
  19. 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, C.E.P.R. Discussion Papers 4052, C.E.P.R. Discussion Papers.
  20. Eyal Winter, 2003. "Incentives and Discrimination," Discussion Paper Series, The Center for the Study of Rationality, Hebrew University, Jerusalem dp313, The Center for the Study of Rationality, Hebrew University, Jerusalem.
  21. Jonathan Guryan, 2004. "Desegregation and Black Dropout Rates," American Economic Review, American Economic Association, American Economic Association, vol. 94(4), pages 919-943, September.
  22. Bruce A. Weinberg & Patricia B. Reagan & Jeffrey J. Yankow, 2004. "Do Neighborhoods Affect Hours Worked? Evidence from Longitudinal Data," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 22(4), pages 891-924, October.
  23. David J. Zimmerman, 2003. "Peer Effects in Academic Outcomes: Evidence from a Natural Experiment," The Review of Economics and Statistics, MIT Press, vol. 85(1), pages 9-23, February.
  24. Armen A. Alchian & Harold Demsetz, 1971. "Production, Information Costs and Economic Organizations," UCLA Economics Working Papers, UCLA Department of Economics 10A, UCLA Department of Economics.
  25. Itoh, Hideshi, 1991. "Incentives to Help in Multi-agent Situations," Econometrica, Econometric Society, Econometric Society, vol. 59(3), pages 611-36, May.
  26. Lawrence Katz & B. Jeffrey Liebman, 2000. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," Working Papers 820, Princeton University, Department of Economics, Industrial Relations Section..
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Klor, Esteban F. & Kube, Sebastian & Winter, Eyal & Zultan, Ro’i, 2014. "Can higher rewards lead to less effort? Incentive reversal in teams," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 97(C), pages 72-83.
  2. Papps, Kerry L. & Bryson, Alex & Gomez, Rafael, 2011. "Heterogeneous worker ability and team-based production: Evidence from major league baseball, 1920-2009," Labour Economics, Elsevier, Elsevier, vol. 18(3), pages 310-319, June.
  3. repec:lan:wpaper:3944 is not listed on IDEAS
  4. Natalia Montinari, 2011. "The Dark Side of Reciprocity," Jena Economic Research Papers 2011-052, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  5. 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.
  6. repec:lan:wpaper:3659 is not listed on IDEAS
  7. Papps, Kerry L., 2010. "Productivity under Large Pay Increases: Evidence from Professional Baseball," IZA Discussion Papers 5133, Institute for the Study of Labor (IZA).
  8. repec:dgr:uvatin:2012130 is not listed on IDEAS
  9. Thomas Cornelissen & Christian Dustmann & Uta Schönberg, 2013. "Peer Effects in the Workplace," CESifo Working Paper Series 4398, CESifo Group Munich.
  10. 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.
  11. 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.
  12. Simmons, Rob & Berri, David J., 2011. "Mixing the princes and the paupers: Pay and performance in the National Basketball Association," Labour Economics, Elsevier, Elsevier, vol. 18(3), pages 381-388, June.
  13. Qiang Fu & Changxia Ke & Fangfang Tan, 2013. ""Success breeds success" or "Pride goes before a fall"? Teams and Individuals in Best-of-Three Contests," Working Papers, Max Planck Institute for Tax Law and Public Finance tax-mpg-rps-2013-06, Max Planck Institute for Tax Law and Public Finance.
  14. repec:lan:wpaper:3551 is not listed on IDEAS
  15. Sander Hoogendoorn & Simon C. Parker & Mirjam van Praag, 2014. "Ability Dispersion and Team Performance," Tinbergen Institute Discussion Papers 14-053/VII, Tinbergen Institute.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp3096. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.