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The effect of charitable giving on workers’ performance: Experimental evidence

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  • Charness, Gary
  • Cobo-Reyes, Ramón
  • Sánchez, Ángela

Abstract

We investigate how donating worker earnings for voluntary extra work, a form of corporate social responsibility, affects worker behavior. Participants entered data for 60minutes, with piece-rate pay. They could then stay for up to another 30minutes; we varied the piece-rate pay and whether it was paid to the worker or to charity. When this piece-rate is high, workers produce more for own pay than when their earnings go to charity. However, with low piece-rates, this relationship reverses. There is also little difference in performance between paying workers a small amount and not paying anything at all.

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  • Charness, Gary & Cobo-Reyes, Ramón & Sánchez, Ángela, 2016. "The effect of charitable giving on workers’ performance: Experimental evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 131(PA), pages 61-74.
    • Handle: RePEc:eee:jeborg:v:131:y:2016:i:pa:p:61-74
    DOI: 10.1016/j.jebo.2016.08.009
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    Cited by:

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    2. Au, Pak Hung & Li, King King & Zhang, Qing & Zhu, Rong, 2023. "The Hidden Costs of Choice in the Labor Market," IZA Discussion Papers 16623, Institute of Labor Economics (IZA).
    3. Koppel, Hannes & Regner, Tobias, 2019. "What drives motivated agents: The ‘right’ mission or sharing it with the principal?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 83(C).
    4. De Chiara, Alessandro & Manna, Ester, 2022. "Firms' ownership, employees’ altruism, and product market competition," Economic Modelling, Elsevier, vol. 109(C).
    5. Kesternich, Iris & Schumacher, Heiner & Siflinger, Bettina & Schwarz, Stefan, 2021. "Money or meaning? Labor supply responses to work meaning of employed and unemployed individuals," European Economic Review, Elsevier, vol. 137(C).
    6. Schwartz, Daniel & Keenan, Elizabeth A. & Imas, Alex & Gneezy, Ayelet, 2021. "Opting-in to prosocial incentives," Organizational Behavior and Human Decision Processes, Elsevier, vol. 163(C), pages 132-141.
    7. Charness, Gary & Gneezy, Uri & Henderson, Austin, 2018. "Experimental methods: Measuring effort in economics experiments," Journal of Economic Behavior & Organization, Elsevier, vol. 149(C), pages 74-87.
    8. Gauriot, Romain & Heger, Stephanie A. & Slonim, Robert, 2020. "Altruism or diminishing marginal utility?," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 24-48.
    9. Hiller, Victor & Raffin, Natacha, 2020. "Firms’ social responsibility and workers’ motivation at the industry equilibrium," Journal of Economic Behavior & Organization, Elsevier, vol. 174(C), pages 131-149.
    10. Ester Manna, 2017. "Customer‐oriented employees: Blessing or curse for firms?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 26(4), pages 842-875, December.
    11. Colleen M. Boland & Corinna Ewelt-Knauer & Julia Schneider, 2022. "The gift that keeps on giving: corporate giving and excessive risk-taking," Journal of Business Economics, Springer, vol. 92(3), pages 355-396, April.
    12. Ravid, Oded & Malul, Miki & Zultan, Ro’i, 2021. "Incentives, mission and productivity," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 91(C).
    13. Daniel Jones & Mirco Tonin & Michael Vlassopoulos, 2018. "Paying for what kind of Performance? Performance Pay and Multitasking in Mission-Oriented Jobs," CESifo Working Paper Series 7156, CESifo.
    14. Daniel Schwartz & Elizabeth A. Keenan & Alex Imas & Ayelet Gneezy, 2017. "Opting-in to Prosocial Incentives," CESifo Working Paper Series 6840, CESifo.
    15. Reggiani, Tommaso G. & Rilke, Rainer Michael, 2020. "When Too Good Is Too Much: Social Incentives and Job Selection," IZA Discussion Papers 12905, Institute of Labor Economics (IZA).
    16. Harpenau, Franziska & Magalhaes, Katrin Marques & Steffen, Nico & Wiewiorra, Lukas, 2023. "Saving behaviors of private households under varying tariff structures, price levels and incentives - Experimental evidence," WIK Working Papers 7, WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH, Bad Honnef.
    17. Kajackaite, Agne & Sliwka, Dirk, 2020. "Prosocial managers, employee motivation, and the creation of shareholder value," Journal of Economic Behavior & Organization, Elsevier, vol. 172(C), pages 217-235.
    18. Chetan Dave & Sjur Hamre & Curtis Kephart & Alicja Reuben, 2020. "Subjects in the lab, activists in the field: public goods and punishment," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 10(3), pages 533-553, September.
    19. Kajackaite, Agne & Sliwka, Dirk, 2018. "Prosocial Managers, Employee Motivation, and the Creation of Shareholder Value," IZA Discussion Papers 11789, Institute of Labor Economics (IZA).
    20. Stein, Caroline & Untertrifaller, Anna, 2020. "The effect of ethical responsibility on performance," MPRA Paper 99176, University Library of Munich, Germany.
    21. Kajackaite, Agne & Sliwka, Dirk, 2017. "Social responsibility and incentives in the lab: Why do agents exert more effort when principals donate?," Journal of Economic Behavior & Organization, Elsevier, vol. 142(C), pages 482-493.

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    More about this item

    Keywords

    Charity; Productivity; CSR policy; Effective incentive;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D29 - Microeconomics - - Production and Organizations - - - Other
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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