IDEAS home Printed from https://ideas.repec.org/p/zar/wpaper/dt2007-04.html
   My bibliography  Save this paper

Equality versus equity bases pay systems and their effects on rational altruism motivation in teams: wicked masked altruism

Author

Listed:
  • Javier García Bernal

    () (Departamento de Economía y Dirección de Empresas. Facultad de Ciencias Económicas y Empresariales. Universidad de Zaragoza)

  • Marisa Ramírez Alesón

    (Departamento de Economía y Dirección de Empresas. Facultad de Ciencias Económicas y Empresariales. Universidad de Zaragoza)

Abstract

This paper analyses the design of optimal incentives in teams both with and without rational altruism. The main contribution of the paper is to study the influence of the incentive function on the altruism parameter chosen by team members. We find that optimal incentive is independent of the presence of rational altruism. Secondly, we compare the welfare loss of equal sharing rules versus second best optimal sharing rules (based on equity). Finally, we distinguish between two sources of rational altruism: 1) the strategic component, and 2) an additional component that reflects wicked behavior by some agents, reducing the firm’s efficiency.

Suggested Citation

  • Javier García Bernal & Marisa Ramírez Alesón, 2007. "Equality versus equity bases pay systems and their effects on rational altruism motivation in teams: wicked masked altruism," Documentos de Trabajo dt2007-04, Facultad de Ciencias Económicas y Empresariales, Universidad de Zaragoza.
  • Handle: RePEc:zar:wpaper:dt2007-04
    as

    Download full text from publisher

    File URL: http://www.dteconz.unizar.es/DT2007-04.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Robert E. Baldwin, 1989. "Measuring Nontariff Trade Policies," NBER Working Papers 2978, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Rational Altruism; incentives in teams; equity based pay system; wicked masked altruism;

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

    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:zar:wpaper:dt2007-04. 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: (Vicente Pinilla). General contact details of provider: http://edirc.repec.org/data/fezares.html .

    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.

    We have no references for this item. You can help adding them by using 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.