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Social Preferences or Personal Career Concerns? Field Evidence on Positive and Negative Reciprocity in the Workplace

Author Info

  • Leif Brandes

    ()

    (Department of Business Administration, University of Zurich)

  • Egon Franck

    ()

    (Department of Business Administration, University of Zurich)

Abstract

This paper provides non-experimental field evidence on positive and negative worker reciprocity. We analyze the performance reactions of professional workers to fair and unfair wage allocations in their natural environment. The objects of interest are professional soccer players in the German Bundesliga. This environment enables us to circumvent the main problems of observational studies on reciprocity because there is substantial transparency in individual player values and performance. Our main finding is that workers exhibit both positive and negative reciprocity toward employers who deviate from a playerÕs perception of a fair market wage. This perception of a fair wage follows from a Mincer-type wage equation that incorporates a workerÕs past performance. The different results between changing and non-changing players are in line with theories of fairness perception but cannot be explained by private information from the employers or the personal career concerns of the players. Altogether, our findings provide strong evidence for the external validity of previous laboratory results on gift exchange in the labor market.

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File URL: http://repec.business.uzh.ch/RePEc/iso/ISU_WPS/134_ISU_full.pdf
File Function: Revised version, 2012
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Paper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Working Papers with number 0134.

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Length: 47 pages
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Handle: RePEc:iso:wpaper:0134
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Keywords: Reciprocity; Fairness; Gift-Exchange; Job Change;

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Find related papers by JEL classification:
  • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
  • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
  • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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Cited by:

  1. Herm, Steffen & Callsen-Bracker, Hans-Markus & Kreis, Henning, 2014. "When the crowd evaluates soccer players’ market values: Accuracy and evaluation attributes of an online community," Sport Management Review, Elsevier, vol. 17(4), pages 484-492.
  2. Bicskei, Marianna & Lankau, Matthias & Bizer, Kilian, 2014. "Negative reciprocity and its relation to anger-like emotions in homogeneous and heterogeneous groups," Center for European, Governance and Economic Development Research Discussion Papers 203, University of Goettingen, Department of Economics.

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