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Do Employees Care About Their Relative Position? Behavioural Evidence Focusing on Performance

Author Info

Listed author(s):
  • Benno Torgler

    ()

    (QUT)

  • Markus Schaffner

    ()

    (QUT)

  • Sascha L. Schmidt
  • Bruno S.Frey

Abstract

Do employees care about their relative (economic) position among co-workers in an organization? And if so, does it raise or lower their performance? Behavioral evidence on these important questions is rare. This paper takes a novel approach to answering these questions, working with sports data from two different disciplines, basketball and soccer. These sports tournaments take place in a controlled environment defined by the rules of the game. We find considerable support that positional concerns and envy reduce individual performance. In contrast, there does not seem to be any tolerance for income disparity, based on the hope that such differences signal that better times are under way. Positive behavioral consequences are observed for those who are experiencing better times.

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File URL: http://external-apps.qut.edu.au/business/documents/discussionPapers/2008/231Torgler.pdf
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Paper provided by School of Economics and Finance, Queensland University of Technology in its series School of Economics and Finance Discussion Papers and Working Papers Series with number 231.

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Length: 31 pages
Date of creation: 16 Jun 2008
Date of revision: 16 Jun 2008
Handle: RePEc:qut:dpaper:231
Contact details of provider: Postal:
GPO Box 2434, BRISBANE QLD 4001

Web page: http://www.bus.qut.edu.au/faculty/economics/
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More information through EDIRC

Keywords: Relative income; positional concerns; envy; social comparison; relative derivation; performance;

Other versions of this item:

Find related papers by JEL classification:
  • D00 - Microeconomics - - General - - - General
  • D60 - Microeconomics - - Welfare Economics - - - General
  • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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Cited by:

  1. Angelova, Vera & Güth, Werner & Kocher, Martin G., 2012. "Co-employment of permanently and temporarily employed agents," Labour Economics, Elsevier, vol. 19(1), pages 48-58.
  2. Egon Franck & Stephan Nüesch, 2012. "Talent And/Or Popularity: What Does It Take To Be A Superstar?," Economic Inquiry, Western Economic Association International, vol. 50(1), pages 202-216, 01.

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