IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/26366.html
   My bibliography  Save this paper

Behavioral Labor Economics

Author

Listed:
  • Berg, Nathan

Abstract

Behavioral economics has in recent decades emerged as a prominent set of methodological developments that have attracted considerable attention both within and outside the economics profession. The time is therefore auspicious to assess behavioral contributions to particular subfields of economics such as labor economics. With empirical validity among its chief objectives, one might guess that behavioral economics would have made its clearest mark in data-driven subfields such as labor economics. Motivated in part by the question of why labor economics has been a relatively slow adopter of behavioral theory, this essay surveys a wide range of behavioral studies that address core labor issues. Part of the explanation is that labor economists working in the neoclassical tradition have been relatively frank in revealing shortcomings of the neoclassical theory and aggressive in empirically testing its predictions. Therefore, new work in behavioral labor economics may represent less of a methodological break than in other subfields of economics.

Suggested Citation

  • Berg, Nathan, 2006. "Behavioral Labor Economics," MPRA Paper 26366, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:26366
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/26366/1/MPRA_paper_26366.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Colin Camerer & Linda Babcock & George Loewenstein & Richard Thaler, 1997. "Labor Supply of New York City Cabdrivers: One Day at a Time," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(2), pages 407-441.
    2. George A. Akerlof & Janet L. Yellen, 1990. "The Fair Wage-Effort Hypothesis and Unemployment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(2), pages 255-283.
    3. Joseph Henrich, 2001. "In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies," American Economic Review, American Economic Association, vol. 91(2), pages 73-78, May.
    4. Yotopoulos, Pan A & Floro, Sagrario L, 1992. "Income Distribution, Transaction Costs and Market Fragmentation in Informal Credit Markets," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 16(3), pages 303-326, September.
    5. Kagel,John H. & Battalio,Raymond C. & Green,Leonard, 2007. "Economic Choice Theory," Cambridge Books, Cambridge University Press, number 9780521035927, October.
    6. Apps, P. F. & Rees, R., 1996. "Labour supply, household production and intra-family welfare distribution," Journal of Public Economics, Elsevier, vol. 60(2), pages 199-219, May.
    7. Boddy, Raford & Frantz, Roger & Poe-Tierney, Barbara, 1986. "The marginal productivity theory: Production line and machine level by work-shift and time of day," Journal of Behavioral Economics, Elsevier, vol. 15(1-2), pages 1-23.
    8. Romme, A. Georges L., 1990. "Projecting female labor supply: The relevance of social norm change," Journal of Economic Psychology, Elsevier, vol. 11(1), pages 85-99, March.
    9. Emmanuel Saez, 2002. "Optimal Income Transfer Programs: Intensive versus Extensive Labor Supply Responses," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 1039-1073.
    10. Lerner, Miri, 1989. "Paternalism and entrepreneurship the emergence of state-made entrepreneurs," Journal of Behavioral Economics, Elsevier, vol. 18(3), pages 149-166.
    11. Korpi, Tomas, 1997. "Is utility related to employment status? Employment, unemployment, labor market policies and subjective well-being among Swedish youth," Labour Economics, Elsevier, vol. 4(2), pages 125-147, June.
    12. Richard B. Freeman, 1997. "In Honor of David Card: Winner of the John Bates Clark Medal," Journal of Economic Perspectives, American Economic Association, vol. 11(2), pages 161-178, Spring.
    13. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(2), pages 321-334, June.
    14. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association, vol. 50(2), pages 321-34, June.
    15. Norsworthy, J R & Zabala, Craig A, 1990. "Worker Attitudes and the Cost of Production: Hypothesis Tests in an Equilibrium Model," Economic Inquiry, Western Economic Association International, vol. 28(1), pages 57-78, January.
    16. Berg, Nathan, 2003. "Normative behavioral economics," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 32(4), pages 411-427, September.
    17. Nathan Berg & Donald Lien, 2003. "Tracking error decision rules and accumulated wealth," Applied Mathematical Finance, Taylor & Francis Journals, vol. 10(2), pages 91-119.
    18. Sharir, Shmuel, 1976. "Work choices under an earnings target: The case of multiple jobholding," Journal of Behavioral Economics, Elsevier, vol. 5(2), pages 93-118.
    19. Sethi, Rajiv & Somanathan, E., 2001. "Preference Evolution and Reciprocity," Journal of Economic Theory, Elsevier, vol. 97(2), pages 273-297, April.
    20. Frantz, Roger S. & Green, Lou, 1982. "Prejudice, mistrust and labor effort: Social influences on productivity," Journal of Behavioral Economics, Elsevier, vol. 11(1), pages 101-131.
    21. Raymond Battalio & Leonard Green & John Kagel, 1995. "Economic choice theory. an experimental analysis of animal behavior," Framed Field Experiments 00166, The Field Experiments Website.
    22. Ali, Farman & Parikh, Ashok & Shah, Mir Kalan, 1996. "Measurement of economic efficiency using the behavioral and stochastic cost frontier approach," Journal of Policy Modeling, Elsevier, vol. 18(3), pages 271-287, June.
    23. Dunn, L F, 1996. "Loss Aversion and Adaptation in the Labor Market: Empirical Indifference Functions and Labor Supply," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 441-450, August.
    24. Lindbeck, Assar, 1997. "Incentives and Social Norms in Household Behavior," American Economic Review, American Economic Association, vol. 87(2), pages 370-377, May.
    25. Goldsmith, Arthur H. & Darity, William Jr., 1992. "Social psychology, unemployment exposure and equilibrium unemployment," Journal of Economic Psychology, Elsevier, vol. 13(3), pages 449-471, September.
    26. Ernst Fehr & Lorenz Goette, 2007. "Do Workers Work More if Wages Are High? Evidence from a Randomized Field Experiment," American Economic Review, American Economic Association, vol. 97(1), pages 298-317, March.
    27. Kuran, Timur, 1998. "Ethnic Norms and Their Transformation through Reputational Cascades," The Journal of Legal Studies, University of Chicago Press, vol. 27(2), pages 623-659, June.
    28. William T. Dickens, 1990. "Assuming The Can Opener: Hedonic Wage Estimates and the Value of Life," NBER Working Papers 3446, National Bureau of Economic Research, Inc.
    29. Tiemann, Thomas K. & Veglahn, Peter A., 1979. "Market concentration: The relationship to job satisfaction," Journal of Behavioral Economics, Elsevier, vol. 8(2), pages 137-150.
    30. Vernon L. Smith, 2003. "Constructivist and Ecological Rationality in Economics," American Economic Review, American Economic Association, vol. 93(3), pages 465-508, June.
    31. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-444, June.
    32. Di Tommaso, M.L. & Weeks, M., 2000. "Decision Structures and Discrete Choices: An Application to Labour Market Participation and Fertility," Cambridge Working Papers in Economics 0009, Faculty of Economics, University of Cambridge.
    33. Stiglitz, Joseph E., 1988. "Economic organization, information, and development," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 5, pages 93-160, Elsevier.
    34. Carlin, Paul S., 1989. "Why the incidence of shirking varies across employers," Journal of Behavioral Economics, Elsevier, vol. 18(2), pages 61-73.
    35. Bruce E. Kaufman, 1989. "Models of Man in Industrial Relations Research," ILR Review, Cornell University, ILR School, vol. 43(1), pages 72-88, October.
    36. Grossbard-Shechtman, Shoshana Amyra & Neuman, Shoshana, 1988. "Women's Labor Supply and Marital Choice," Journal of Political Economy, University of Chicago Press, vol. 96(6), pages 1294-1302, December.
    37. Allen, R. Douglas & Fry, Fred L., 1987. "An investigation of sex as a moderator of the relationship between occupational stress and perceived organizational effectiveness in formal groups," Journal of Behavioral Economics, Elsevier, vol. 16(2), pages 9-15.
    38. George A. Akerlof, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 97(4), pages 543-569.
    39. Henry S. Farber, 2003. "Is Tomorrow Another Day? The Labor Supply Of New York Cab Drivers," Working Papers 110, Princeton University, Department of Economics, Center for Economic Policy Studies..
    40. repec:pri:cepsud:92farber is not listed on IDEAS
    41. Henry S. Farber, 2003. "Is Tomorrow Another Day? The Labor Supply of New York City Cab Drivers," Working Papers 852, Princeton University, Department of Economics, Industrial Relations Section..
    42. Henry Farber, 2003. "Is Tomorrow Another Day? The Labor Supply of New York Cab Drivers," NBER Working Papers 9706, National Bureau of Economic Research, Inc.
    43. Eckel, Catherine C & Grossman, Philip J, 2001. "Chivalry and Solidarity in Ultimatum Games," Economic Inquiry, Western Economic Association International, vol. 39(2), pages 171-188, April.
    44. Kaneko, Mamoru & Kimura, Toshiyuki, 1992. "Conventions, social prejudices and discrimination: A festival game with merrymakers," Games and Economic Behavior, Elsevier, vol. 4(4), pages 511-527, October.
    45. Putterman, Louis, 1982. "Some behavioral perspectives on the dominance of hierarchical over democratic forms of enterprise," Journal of Economic Behavior & Organization, Elsevier, vol. 3(2-3), pages 139-160.
    46. Henry S. Farber, 2003. "Is Tomorrow Another Day? The Labor Supply of New York City Cab Drivers," Working Papers 852, Princeton University, Department of Economics, Industrial Relations Section..
    47. Henry S. Farber, 2003. "Is Tomorrow Another Day? The Labor Supply Of New York Cab Drivers," Working Papers 110, Princeton University, Department of Economics, Center for Economic Policy Studies..
    48. Duncan, Alan & Weeks, Melvyn, 1997. "Behavioural tax microsimulation with finite hours choices," European Economic Review, Elsevier, vol. 41(3-5), pages 619-626, April.
    49. Ireland, Thomas R., 1989. "How shirking can help productivity: A critique of Carlin and the "Shirking as Harm" theory," Journal of Behavioral Economics, Elsevier, vol. 18(2), pages 75-79.
    50. Morris Altman & Louise Lamontagne, 2003. "On the Natural Intelligence of Women in a World of Constrained Choice: How the Feminization of Clerical Work Contributed to Gender Pay Equality in Early Twentieth Century Canada," Journal of Economic Issues, Taylor & Francis Journals, vol. 37(4), pages 1045-1074, December.
    51. Shelley Phipps & Peter Burton, 1995. "Social/institutional variables and behavior within households: An empirical test using the Luxembourg income study," Feminist Economics, Taylor & Francis Journals, vol. 1(1), pages 151-174.
    52. William T. Dickens, 1990. "Assuming the Can Opener: Hedonic Wage Estimates and the Value of Life," Journal of Forensic Economics, National Association of Forensic Economics, vol. 3(3), pages 51-59, September.
    53. Hattwick, Richard E., 1987. "Democratizing the workplace: The case of Irl C. Martin and the woodward governor company," Journal of Behavioral Economics, Elsevier, vol. 16(2), pages 69-77.
    54. Kahn, Matthew E, 1998. "Health and Labor Market Performance: The Case of Diabetes," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 878-899, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Stavros Drakopoulos & Ioannis Katselidis, 2014. "The Development of Trade Union Theory and Mainstream Economic Methodology," Journal of Economic Issues, Taylor & Francis Journals, vol. 48(4), pages 1133-1149, December.
    2. Dohmen, Thomas, 2014. "Behavioral labor economics: Advances and future directions," Labour Economics, Elsevier, vol. 30(C), pages 71-85.
    3. Altman, Morris, 2014. "Insights from behavioral economics on how labor markets work," Working Paper Series 3466, Victoria University of Wellington, School of Economics and Finance.
    4. Flynn, Sean Masaki & Donnelly, Michael, 2012. "Does labor contract completeness drive unionization? Experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(4), pages 445-454.
    5. Stavros A. Drakopoulos, 2020. "Pay Level Comparisons in Job Satisfaction Research and Mainstream Economic Methodology," Journal of Happiness Studies, Springer, vol. 21(3), pages 825-842, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lorenz Goette & David Huffman & Ernst Fehr, 2004. "Loss Aversion and Labor Supply," Journal of the European Economic Association, MIT Press, vol. 2(2-3), pages 216-228, 04/05.
    2. Shun-ichiro Bessho & Masayoshi Hayashi, 2005. "The CES utility function, non-linear budget constraints and labor supply : results on prime-age males in Japan," Labor Economics Working Papers 21911, East Asian Bureau of Economic Research.
    3. Bessho, Shun-ichiro & Hayashi, Masayoshi, 2011. "Labor supply response and preferences specification: Estimates for prime-age males in Japan," Journal of Asian Economics, Elsevier, vol. 22(5), pages 398-411, October.
    4. Charness, Gary & Kuhn, Peter, 2011. "Lab Labor: What Can Labor Economists Learn from the Lab?," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 3, pages 229-330, Elsevier.
    5. Brian Jacob & Lars Lefgren & Enrico Moretti, 2007. "The Dynamics of Criminal Behavior: Evidence from Weather Shocks," Journal of Human Resources, University of Wisconsin Press, vol. 42(3).
    6. Edward L. Glaeser, 2004. "Psychology and the Market," American Economic Review, American Economic Association, vol. 94(2), pages 408-413, May.
    7. Jose Canals-Cerda, 2005. "Congestion Pricing in an Internet Market," Working Papers 05-10, NET Institute, revised Sep 2005.
    8. Dean Yang, 2006. "Why Do Migrants Return to Poor Countries? Evidence from Philippine Migrants' Responses to Exchange Rate Shocks," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 715-735, November.
    9. Dean Yang, 2006. "Why Do Migrants Return to Poor Countries? Evidence From Philippine Migrants%u2019 Responses to Exchange Rate Shocks," NBER Working Papers 12396, National Bureau of Economic Research, Inc.
    10. Altman, Morris, 2014. "Insights from behavioral economics on how labor markets work," Working Paper Series 18843, Victoria University of Wellington, School of Economics and Finance.
    11. Jessica Goldberg, 2016. "Kwacha Gonna Do? Experimental Evidence about Labor Supply in Rural Malawi," American Economic Journal: Applied Economics, American Economic Association, vol. 8(1), pages 129-149, January.
    12. Botond Kőszegi & Matthew Rabin, 2006. "A Model of Reference-Dependent Preferences," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(4), pages 1133-1165.
    13. Ahrens, Steffen & Pirschel, Inske & Snower, Dennis J., 2014. "A theory of wage adjustment under loss aversion," Kiel Working Papers 1977, Kiel Institute for the World Economy (IfW Kiel).
    14. Dohmen, Thomas, 2014. "Behavioral labor economics: Advances and future directions," Labour Economics, Elsevier, vol. 30(C), pages 71-85.
    15. Matthew D. Shapiro & Christopher L. House, 2006. "Phased-In Tax Cuts and Economic Activity," American Economic Review, American Economic Association, vol. 96(5), pages 1835-1849, December.
    16. Roland Benabou & Jean Tirole, 2004. "Willpower and Personal Rules," Journal of Political Economy, University of Chicago Press, vol. 112(4), pages 848-886, August.
    17. Helen Robinson & Jonathan Wadsworth, 2007. "Impact Of The Minimum Wage On The Incidence Of Second Job Holding In Britain," Scottish Journal of Political Economy, Scottish Economic Society, vol. 54(4), pages 553-574, September.
    18. Altman, Morris, 2014. "Insights from behavioral economics on how labor markets work," Working Paper Series 3466, Victoria University of Wellington, School of Economics and Finance.
    19. Christopher L. House & Matthew D. Shapiro, 2008. "Temporary Investment Tax Incentives: Theory with Evidence from Bonus Depreciation," American Economic Review, American Economic Association, vol. 98(3), pages 737-768, June.
    20. Heike Hennig‐Schmidt & Abdolkarim Sadrieh & Bettina Rockenbach, 2010. "In Search of Workers' Real Effort Reciprocity—a Field and a Laboratory Experiment," Journal of the European Economic Association, European Economic Association, vol. 8(4), pages 817-837, June.

    More about this item

    Keywords

    Behavioral Economics; Bounded Rationality; Ecological Rationality; As-If; Methodology; Choice Under Uncertainty; Procedural Rationality;
    All these keywords.

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:26366. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.