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Wages and Reciprocity in the Workplace

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  • Abigail Barr

    (Centre for the Study of African Economies)

  • Pieter Serneels

    (Centre for the Study of African Economies)

Abstract

We explore the role of reciprocity in wage determination by combining experimental and survey data. The experiment is similar to Berg, Dickhaut and McCabe's (1995) and is conducted with Ghanaian manufacturing workers. The survey relates to the same sample workers and the firms within which they are mployed. We find a strong positive association between individual reciprocity and individual wages. However, the direction of causality is unclear. Various aspects of the distribution of the tendency to reciprocate within an employee's workforce are also associated with that employee's wage and, in this case, there are strong arguments for a causal link is from former to latter. In particular, the mean, median, and minimum levels of reciprocity have a positive effect on wages, while the spread in the distribution (standard deviation) has a strong significant negative effect. This suggests that homogenous behaviour, or convergence to a norm, is rewarded. The results underline theimportance of behavioural characteristics and firm culture for the operation of the labour market.

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Bibliographic Info

Paper provided by EconWPA in its series Development and Comp Systems with number 0409064.

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Length: 31 pages
Date of creation: 28 Sep 2004
Date of revision:
Handle: RePEc:wpa:wuwpdc:0409064

Note: Type of Document - pdf; pages: 31
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Web page: http://128.118.178.162

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Keywords: wages; reciprocity; field experiment;

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References

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Citations

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Cited by:
  1. Steven D. Levitt & John A. List, 2008. "Field Experiments in Economics: The Past, The Present, and The Future," NBER Working Papers 14356, National Bureau of Economic Research, Inc.
  2. James Andreoni, 2005. "Trust, Reciprocity, and Contract Enforcement: Experiments on Satisfaction Guaranteed," Levine's Bibliography 666156000000000679, UCLA Department of Economics.
  3. Abigail Barr, 2004. "Rational and Biased Trust," Economics Series Working Papers WPS/2004-22, University of Oxford, Department of Economics.
  4. Matthias Benz & Stephan Meier, 2006. "Do people behave in experiments as in the field?: evidence from donations," Working Papers 06-8, Federal Reserve Bank of Boston.
  5. Jeffrey Carpenter & Erika Seki, 2005. "Do Social PreferencesIncrease Productivity? Field experimental evidence from fishermen in Toyoma Bay," Middlebury College Working Paper Series 0515, Middlebury College, Department of Economics.
  6. Jack, B. Kelsey, 2009. "Upstream-downstream transactions and watershed externalities: Experimental evidence from Kenya," Ecological Economics, Elsevier, vol. 68(6), pages 1813-1824, April.

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