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In Search of Workers' Real Effort Reciprocity—a Field and a Laboratory Experiment

  • Heike Hennig‐Schmidt
  • Abdolkarim Sadrieh
  • Bettina Rockenbach

We present a field experiment to assess the effect of own and peer wage variations on actual work effort of employees with hourly wages. Work effort neither reacts to an increase of the own wage, nor to a positive or negative peer comparison. This result seems at odds with numerous laboratory experiments that show a clear own wage sensitivity on effort. In an additional real-effort laboratory experiment we show that explicit cost and surplus information that enables to exactly calculate employer's surplus from the work contract is a crucial pre-requisite for a positive wage-effort relation. This demonstrates that employee's reciprocity requires a clear assessment of the surplus at stake.

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Article provided by European Economic Association in its journal Journal of the European Economic Association.

Volume (Year): 8 (2010)
Issue (Month): 4 (06)
Pages: 817-837

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Handle: RePEc:bla:jeurec:v:8:y:2010:i:4:p:817-837
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  16. Fahr, Rene & Irlenbusch, Bernd, 2000. "Fairness as a constraint on trust in reciprocity: earned property rights in a reciprocal exchange experiment," Economics Letters, Elsevier, vol. 66(3), pages 275-282, March.
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  18. Gary Charness & Peter Kuhn, 2005. "Pay Inequality, Pay Secrecy, and Effort: Theory and Evidence," NBER Working Papers 11786, National Bureau of Economic Research, Inc.
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