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Status and incentives

  • Renault, Régis
  • Auriol, Emmanuelle

The paper introduces status as re ecting an agent's claim to recognition in her work. It is a scarce resource: increasing an agent's status requires that another agent's status is decreased. Higher status agents are more willing to exert e ort in exchange for money; better-paid agents would exert a higher e ort in exchange for an improved status. Results are coherent with actual management practices: (i) egalitarianism is desirable in a static context; (ii) in a long-term work relationship, juniors' compensations are delayed; past performances are recompensed by pay increases along with an improved status within the organization's hierarchy.

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File URL: http://basepub.dauphine.fr/xmlui/bitstream/123456789/12479/1/9fcfd50c063cabf39d.pdf
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Paper provided by Paris Dauphine University in its series Economics Papers from University Paris Dauphine with number 123456789/12479.

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Date of creation: 2008
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Publication status: Published in RAND Journal of Economics, 2008, Vol. 39, no. 1. pp. 305-326.Length: 21 pages
Handle: RePEc:dau:papers:123456789/12479
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