Cohesiveness, Productivity, and Wage Dispersion
When work groups support the goals of the firm, firms will want to narrow wage dispersion in order to increase group cohesiveness and productivity. This narrowing of wage differentials has several implications: (1) Firms will pay wages that vary less than marginal productivity; (2) Firms that must pay the high end of their wage distribution a particularly high wage will pay all workers particularly high wages; (3) The market ignores the rent that egalitarian wages provide to low-wage workers, and the rent will be under-provided in equilibrium. At the margin, increasing the number of workers in cohesive firms and/or increasing wages for the low end of the wage distribution will increase the total amount of rents, raising national output.
|Date of creation:||01 Jan 1989|
|Contact details of provider:|| Postal: 2521 Channing Way # 5555, Berkeley, CA 94720-5555|
Web page: http://www.escholarship.org/repec/iir_iirwps/
More information through EDIRC
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.:
- Andrew Weiss, 1987. "Incentives and Worker Behavior: Some Evidence," NBER Working Papers 2194, National Bureau of Economic Research, Inc.
- Lawrence F. Katz, 1986.
"Efficiency Wage Theories: A Partial Evaluation,"
NBER Working Papers
1906, National Bureau of Economic Research, Inc.
- Frank, Robert H, 1984. "Are Workers Paid Their Marginal Products?," American Economic Review, American Economic Association, vol. 74(4), pages 549-571, September.
When requesting a correction, please mention this item's handle: RePEc:cdl:indrel:qt8kd4d0p4. 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: (Lisa Schiff)
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.