Peer Pressure in Multi-Dimensional Work Tasks
AbstractWe study the influence of peer pressure in multi-dimensional work tasks theoretically and in a controlled laboratory experiment. Thereby, workers face peer pressure in only one work dimension. We find that effort provision increases in the dimension where peer pressure is introduced. However, not all of this increase translates into a productivity gain, since the effect is partly offset by a decrease of effort in the work dimension without peer pressure. Furthermore, this tradeoff is stronger for workers who run behind in the dimension of peer pressure. Finally, we analyze the optimal group composition to harness peer pressure. Effort in the dimension of peer pressure and overall productivity seem to be unaffected by group composition, but the effort reduction in the dimension that is not subject to peer pressure is stronger when workers’ skills are highly diverse. Hence, it seems like optimal group composition depends on work environment. While existing literature recommends maximizing worker-groups’ skill diversity in one-dimensional work tasks, our results suggest to mix similar workers in multi-dimensional tasks.
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Bibliographic InfoPaper provided by University of Cologne, Department of Economics in its series Working Paper Series in Economics with number 57.
Date of creation: 15 Nov 2012
Date of revision:
Peer Effects; Multi Tasking; Incentives; Laboratory Experiment;
Find related papers by JEL classification:
- D03 - Microeconomics - - General - - - Behavioral Microeconomics; Underlying Principles
- D2 - Microeconomics - - Production and Organizations
- J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-12-06 (All new papers)
- NEP-CBE-2012-12-06 (Cognitive & Behavioural Economics)
- NEP-HRM-2012-12-06 (Human Capital & Human Resource Management)
- NEP-LAB-2012-12-06 (Labour Economics)
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