Tournaments and Unfair Treatment
This paper introduces the negative feelings associated with the perception of being unfairly treated into a tournament model and examines the impact of these perceptions on workers’ efforts and their willingness to work overtime. The effect of unfair treatment on workers’ behavior is ambiguous in the model in that two countervailing effects arise: a negative impulsive effect and a positive strategic effect. The impulsive effect implies that workers react to the perception of being unfairly treated by reducing their level of effort. The strategic effect implies that workers raise this level in order to improve their career opportunities and thereby avoid feeling even more unfairly treated in the future. An empirical test of the model using survey data from a Swedish municipal utility shows that the overall effect is negative. This suggests that employers should consider the negative impulsive effect of unfair treatment on effort and overtime in designing contracts and determining on promotions.
|Date of creation:||06 Dec 2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (0)8 - 16 32 48
Fax: (0)8 - 15 46 70
Web page: http://www.sofi.su.se/
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.:
- Akerlof, George A & Yellen, Janet L, 1988. "Fairness and Unemployment," American Economic Review, American Economic Association, vol. 78(2), pages 44-49, May.
- Anger, Silke, 2003.
"Unpaid overtime in Germany : differences between East and West,"
SFB 373 Discussion Papers
2003,42, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
- Silke Anger, 2005. "Unpaid Overtime in Germany: Differences between East and West," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 125(1), pages 17-27.
- Anger, Silke, 2005. "Unpaid Overtime in Germany: Differences between East and West," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 17-27.
- Grund, Christian & Sliwka, Dirk, 2002.
"Envy and Compassion in Tournaments,"
IZA Discussion Papers
647, Institute for the Study of Labor (IZA).
- Lazear, Edward P & Rosen, Sherwin, 1981.
"Rank-Order Tournaments as Optimum Labor Contracts,"
Journal of Political Economy,
University of Chicago Press, vol. 89(5), pages 841-64, October.
- Linda A. Bell & Richard B. Freeman, 2000.
"The Incentive for Working Hard: Explaining Hours Worked Differences in the U.S. and Germany,"
NBER Working Papers
8051, National Bureau of Economic Research, Inc.
- Bell, Linda A. & Freeman, Richard B., 2001. "The incentive for working hard: explaining hours worked differences in the US and Germany," Labour Economics, Elsevier, vol. 8(2), pages 181-202, May.
- Steven Wu & Brian Roe, 2006. "Tournaments, Fairness, and Risk," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(3), pages 561-573.
- Akerlof, George A, 1984. "Gift Exchange and Efficiency-Wage Theory: Four Views," American Economic Review, American Economic Association, vol. 74(2), pages 79-83, May.
- Wu, Steven Y. & Roe, Brian E., 2006. "AJAE Appendix: Tournaments, Fairness, and Risk," American Journal of Agricultural Economics Appendices, Agricultural and Applied Economics Association, vol. 88(3), August.
- repec:tpr:qjecon:v:109:y:1994:i:4:p:921-55 is not listed on IDEAS
- Kräkel, Matthias, 2005. "Emotions and the Optimality of Unfair Tournaments," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 45, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Stark, Oded, 1990. "A Relative Deprivation Approach to Performance Incentives in Career Games and Other Contests," Kyklos, Wiley Blackwell, vol. 43(2), pages 211-27.
- repec:tpr:qjecon:v:109:y:1994:i:4:p:881-919 is not listed on IDEAS
- repec:tpr:qjecon:v:105:y:1990:i:2:p:255-83 is not listed on IDEAS
- Francesconi, Marco, 2001. " Determinants and Consequences of Promotions in Britain," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(3), pages 279-310, July.
- Becker, Gary S, 1985. "Human Capital, Effort, and the Sexual Division of Labor," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages S33-58, January.
- Krakel, Matthias, 2000. "Relative deprivation in rank-order tournaments," Labour Economics, Elsevier, vol. 7(4), pages 385-407, July.
- Silke Anger, 2005.
"Working Time as an Investment? – The Effects of Unpaid Overtime on Wages, Promotions and Layoffs,"
SFB 649 Discussion Papers
SFB649DP2005-032, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
- Silke Anger, 2005. "Working Time as an Investment?: The Effects of Unpaid Overtime on Wages, Promotions, and Layoffs," Discussion Papers of DIW Berlin 535, DIW Berlin, German Institute for Economic Research.
- Meyer, Margaret A, 1992. "Biased Contests and Moral Hazard: Implications for Career Profiles," CEPR Discussion Papers 637, C.E.P.R. Discussion Papers.
- Edward P. Lazear, 2004. "The Peter Principle: A Theory of Decline," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages S141-S163, February.
- repec:tpr:qjecon:v:97:y:1982:i:4:p:543-69 is not listed on IDEAS
- Arai, Mahmood, 1989. "Monitoring and additional wages in labour extraction," Journal of Economic Behavior & Organization, Elsevier, vol. 11(1), pages 115-125, January.
- Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2003. "A sticky floors model of promotion, pay, and gender," European Economic Review, Elsevier, vol. 47(2), pages 295-322, April.
- Landers, Renee M & Rebitzer, James B & Taylor, Lowell J, 1996. "Rat Race Redux: Adverse Selection in the Determination of Work Hours in Law Firms," American Economic Review, American Economic Association, vol. 86(3), pages 329-48, June.
When requesting a correction, please mention this item's handle: RePEc:hhs:sofiwp:2006_008. 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: (Lena Lindahl)
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.